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Which of the Following Statements Is Correct

Question 13

Multiple Choice

Which of the following statements is correct?


A) Suppose Company A's EPS is expected to experience a larger percentage change in response to a given percentage change in sales than Company B's EPS.Other things held constant,Company A would appear to have more business risk than Company B.
B) Statement a would be correct if the term "EBIT" were substituted for "EPS."
C) Statement a would be correct if the term "EBIT" were substituted for "sales."
D) Statement a would be correct if the words "financial risk" were substituted for "business risk."
E) The above statements are all false.

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