Economics · Financial Management
Given below are two statements: one is labeled as Assertion (A) and the other is labeled as Reason (R). Assertion (A): If EBIT = ₹2,00,000 and Interest = ₹1,00,000, Degree of Financial Leverage (DFL) is 2. Reason (R): DFL = EBITEBIT - Interest
Verified Solution4 OptionsUpdated: October 2026👁️1 View
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- 1A is false, but R is true
- 2A is true, but R is false
- 3Both A and R are true, but R is NOT the correct explanation of A
- 4Both A and R are true, and R is the correct explanation of A✓
Correct answer
Both A and R are true, and R is the correct explanation of A
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