Leverage and capital structure - leverage
3 important questions on Leverage and capital structure - leverage
What is the breakeven analysis?
Used to indicate the level of operations necessary to cover all costs and to evaluate the profitability associated with various levels of sales
What is the financial leverage?
The use of fixed financial costs to magnify the effects of changes in earnings before interest and taxes on the firm's eps
What is the degree of financial leverage (DFL)
The numerical measure of the firm's financial leverage
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