Economics · Leverage Analysis

Operating leverage and Financial leverage of a firm are 3 and 2 respectively. If sales increase by 5%, then earnings before tax (EBT) will rise by:

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125%
230%✓
310%
415%

Correct answer

30%

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Operating leverage and Financial leverage of a firm are 3 and 2 respectively. If sales increase by 5%, then earnings before tax (EBT) will rise by:

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Operating leverage and Financial leverage of a firm are 3 and 2 respectively. If sales increase by 5%, then earnings before tax (EBT) will rise by:

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