The percentage change in earnings per share (EPS) that results from a given percentage change in sales is known as the _____.
A) degree of financial leverage
B) degree of operating leverage
C) degree of working capital leverage
D) degree of current asset leverage
E) degree of total leverage

Question

Quizplus · Accepted Answer

The degree of total leverage measures the sensitivity of EPS to changes in sales, combining both operating and financial leverage effects.

The Percentage Change in Earnings Per Share (EPS) That Results