Question: 6 . Which statement about financial leverage is true? Group of answer choices If EBIT is above the break - even point, using more debt
Which statement about financial leverage is true?
Group of answer choices
If EBIT is above the breakeven point, using more debt in the capital structure will lead to higher EPS for a given level of EBIT.
Using more debt in the capital structure will always lead to higher EPS for a given level of EBIT.
If EBIT is below the breakeven point, using more debt in the capital structure will lead to higher EPS for a given level of EBIT.
If a firm uses debt in its capital structure, ROA is greater than ROE.
None are true.
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