A firm has a degree of financial leverage of 1.20.If earnings before interest and tax increase by 20%, then net income:
A) will not necessarily change
B) will increase by 20%
C) will decrease by 24%
D) will decrease by 20%
E) none of the answers are correct
Correct Answer:
Verified
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A)approximates 50%.
B)continues at
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A)common
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