Does high operating leverage always mean high business risk, Financial Management

Assignment Help:

Does high operating leverage always mean high business risk?  Explain.

High operating leverage does not all the time mean high business risk.  If the companies sales are quite stable after that the variation in operating income would be small even if the degree of operating leverage were large. 


Related Discussions:- Does high operating leverage always mean high business risk

Analytical way of viewing financial problems of a firm, Analytical way of v...

Analytical way of viewing financial problems of a firm The new approach is an analytical way of viewing financial problems of a firm. The main contents of this tactic are what

What are the motives of holding cash, Q. What are the Motives of Holding Ca...

Q. What are the Motives of Holding Cash? Motives of Holding Cash: - In every business assets are kept for the reason that they generate profit. But cash is an asset which doesn

Compare the ifrs and gaap revenue recognition policies, SUPERVALU INC . ...

SUPERVALU INC . , a large US retail grocer, had $36.1 billion in sales for its fiscal year ended February 25, 2011. SUPERVALU currently reports using US GAAP. The controller of

Discuss the different forms of financing, Question 1 Explain the concept ...

Question 1 Explain the concept and phases of capital budgeting Question 2 Define and explain the methods of demand forecasting Question 3 Mention the elements o

Explain factoring and term loan financing, A factoring company has offered ...

A factoring company has offered a one-year agreement with Glub Ltd to both manage its debtors and advanced 80 per cent of the value of all its invoices immediately a sale is invoi

Leverage, EVALUATE THE IMPORTANCE OF LEVERAGE IN FINANCIAL MANAGEMENT OF SM...

EVALUATE THE IMPORTANCE OF LEVERAGE IN FINANCIAL MANAGEMENT OF SMALL SCALE COMPANY

What is commercial papers, Q. What is Commercial Papers? Commercial Pap...

Q. What is Commercial Papers? Commercial Papers: Commercial papers (CPs) are short-term, unsecured securities issued by highly creditworthy large companies. They are issued wit

Bond ., The salem company bond currently sells for $955 has a 12% coupon i...

The salem company bond currently sells for $955 has a 12% coupon interest rate and $ 1000 par value pays interest annually an

Working capital cycle, Q. Working capital cycle? In a manufacturing con...

Q. Working capital cycle? In a manufacturing concern the working capital cycle is start with the purchase of the raw material and ends with the realization of the cash from the

What are the limitations of ratio analysis, What are the Limitations of rat...

What are the Limitations of ratio analysis A ratio on its own is meaningless. Accounting ratios should always be interpreted in relation to other information, for illustration:

Write Your Message!

Captcha
Free Assignment Quote

Assured A++ Grade

Get guaranteed satisfaction & time on delivery in every assignment order you paid with us! We ensure premium quality solution document along with free turntin report!

All rights reserved! Copyrights ©2019-2020 ExpertsMind IT Educational Pvt Ltd