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dedylja [7]
3 years ago
6

Operating leverage is easier to control and manage than financial leverage because operating leverage deals with the internal wo

rkings of the company while financing deals with outside parties. True or False ?
Business
1 answer:
zzz [600]3 years ago
7 0

Answer: FALSE

               

Explanation: In simple words, operating leverage refers to the criteria which shows how much operating income can be increase by increasing the revenue of a project. Whereas, financial leverage refers to the level of debt that a firm has acquired for financing its operations.

The management of a company can easily control financial leverage as it is in their hands to issue or redeem debt. On the other hand, increase or decrease in operating income is dependent on various external factor.

Hence the given statement is false.

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Debit cards are connected to funds in your bank account. True or False
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Martin Company has a cash ratio of 0.3. This implies that the company​ _________. A. is not in a position to meet its​ long-term
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D. is not sending a strong message to investors and creditors that it has the ability to repay its​ short-term debt

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The cash ratio helps measure the liquidity of the company as it shows if it can cover its short-term debt with the cash aand cash equivalents it has. When the ratio is less than 1, as in this case, it means that  the company doesn't have enough cash to cover the short-term debt.

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A 480 item pencil and paper standardized test of 20 personality dimensions used in selecting managers, sales associates and lead
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Hogan Personality Inventory

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3 years ago
Paradise, Inc., has identified an investment project with the following cash flows. Year Cash Flow 1 $625 2 875 3 1,150 4 1,250
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(a) If the discount rate is 11 percent, what is the future value of these cash flows in year 4?

To solve this problem, we must find the FV of each cash flow and add them.

To find the FV of a lump sum, we use:

FV = PV(1 + r)^t

[email protected]% = $625(1.11)^3 + $875(1.11)^2+ $1,150(1.11) + $1,250 = $4459

(b) What is the future value at a discount rate of 18 percent?

FV = PV(1 + r)^t

[email protected]% = $625(1.18)^3+ $875(1.18)^2+ $1,150(1.18) + $1,250 = $4852

(c) What is the future value at discount rate of 30 percent?

FV = PV(1 + r)^t

[email protected]% = $625(1.30)^3+ $875(1.30)^2+ $1,150(1.30) + $1,250 = $5597

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