Question: The increase in risk to shareholders when financial leverage is added is best evidenced by: higher EPS as EBIT increases. a higher variability of EPS

The increase in risk to shareholders when financial leverage is added is best evidenced by:
higher EPS as EBIT increases.
a higher variability of EPS with partial debt financing than with all-equity financing.
increased use of homemade leverage.
the increase in taxes.
decreasing earnings as EBIT increases.

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