The level of EBIT that will equate EPS between two different financing plans is called the
A)indifference point.
B)optimal capital plan.
C)pivot point.
D)tradeoff point

Question

Quizplus · Accepted Answer

The level of EBIT that will equate EPS between two different financing plans is called the indifference point. It represents the EBIT level at which a company will earn the same EPS regardless of which financing plan they choose. Therefore, option A is the best choice as it represents the correct term for this concept. Option B (optimal capital plan) refers to the ideal mix of debt and equity financing for a company, which is not the same as the indifference point. Option C (pivot point) and option D (tradeoff point) are not commonly used terms in financial analysis and do not accurately describe the concept in question.

The Level of EBIT That Will Equate EPS Between Two