(1) Why do analysts care about how sensitive EBITDA and EBIT are to changes in revenue? (2)...
Question:
(2) How is the proportion of fixed costs in a project’s cost structure related to the sensitivity of EBITDA and EBIT to changes in revenue?
Fantastic news! We've Found the answer you've been seeking!
Step by Step Answer:
Answer rating: 54% (11 reviews)
1 Comparing the sensitivity of EBITDA to changes in revenue can help you bett...View the full answer
Answered By
Susan Juma
I'm available and reachable 24/7. I have high experience in helping students with their assignments, proposals, and dissertations. Most importantly, I'm a professional accountant and I can handle all kinds of accounting and finance problems.
4.40+
15+ Reviews
45+ Question Solved
Related Book For
Fundamentals of corporate finance
ISBN: 978-0470876442
2nd Edition
Authors: Robert Parrino, David S. Kidwell, Thomas W. Bates
Question Posted:
Students also viewed these Corporate Finance questions
-
Why do analysts care about the current cost of long-term debt when estimating a firms cost of capital?
-
In baseball, a players batting average is the proportion of times the player gets a hit out of his total number of times at bat. The distribution of batting averages in a recent season for Major...
-
If X is the proportion of persons who will respond to one kind of mail- order solicitation, Y is the proportion of persons who will respond to another kind of mail- order solicitation, and the joint...
-
Which statement about sociology as a science is true? A) Most sociologists reject the use of the scientific method. B) Sociologists almost always use hypothesis testing in their research. C) Sociolo...
-
San Jose Company operates a Manufacturing Division and an Assembly Division. Both divisions are evaluated as profit centers. Assembly buys components from Manufacturing and assembles them for sale....
-
If V1 = 456 mL, P1 = 308 torr, and P2 = 1.55 atm, what is V2?
-
The management of Pzazz, Inc., took the following actions that went into effect on January 2, 20x7. Each action involved an application of the time value of money. a. Established in one payment of...
-
On January 1, 2014, the dental partnership of Left, Center, and Right was formed when the partners contributed $20,000, $60,000, and $50,000, respectively. Over the next three years, the business...
-
From the perspective of Detroit Co., which has payables in Mexican pesos and receivables in Canadian dollars, hedging the payables would be most desirable if the expected real cost of hedging...
-
Suppose General Motors (GM) stock sells for 25 dollars a share today. The stock will pay a dividend of 2 dollars at the end of the year. The annual risk free rate is 4 percent. (a) What is the...
-
Candela Corporation ("Candela" or the "Company") is a pioneer in the development and commercialization of advanced aesthetic laser and light based systems that allow physicians and personal care...
-
What do the degree of pretax cash flow operating leverage (Cash Flow DOL) and the degree of accounting operating leverage (Accounting DOL) tell us?
-
How do antitrust laws promote greater price competition?
-
Caregivers should consider themselves as patient advocates because of their position to help patients who are often helpless and unable to speak for themselves.
-
The Financial Crisis of 20079 hit Italy hard. It was one of the countries which faced problems with its deficit. By 2018, the situation had not improved a great deal. Elections in March 2018 failed...
-
Patient responsibilities include maximizing healthy habits, such as exercising, not smoking, and eating healthy; being involved in healthcare decisions; working collaboratively with healthcare...
-
Imagine a firm that employs two types of workers some with computer skills and some without. If technology advances so that computers become more useful to the firm, what happens to the marginal...
-
The optimal tariff for a small country is zero. Prove this statement geometrically and then explain your results.
-
What social problems are of particular interest to you?
-
5. How much would you need to deposit in an account now in order to have $5,000 in the account in 5 years? Assume the account earns 2% interest compounded monthly. 10. You deposit $300 each month...
-
A company has 13,600 equity shares on April 1, 2010 on August 31, 2010 company issued 11,200 more shares and on February 1, 2011, it bought back 1,600 shares. Calculate weighted average number of...
-
A project that provides annual cash flows of $17,300 for nine years costs $79,000 today. Is this a good project if the required return is 8 percent? What if its 20 percent? At what discount rate...
-
What is the IRR of the following set of cash flows? Year Cash Flow 0....... -$16,400 1....... 7,100 2....... 8,400 3....... 6,900
-
Garage, Inc., has identified the following two mutually exclusive projects: a. What is the IRR for each of these projects? Using the IRR decision rule, which project should the company accept? Is...
-
Required information [ The following information applies to the questions displayed below. ] Portions of the financial statements for Parnell Company are provided below. Required: Prepare the cash...
-
ABC, Corporation upon approval of its Articles of Incorporation by Secretary of State of State where it incorporated had 1 , 0 0 0 . 0 0 shares authorized to issue to shareholders. Aaron was issued 1...
-
Where did you get the opening balance?
Study smarter with the SolutionInn App