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27 A firm has EBIT of $80,000 and interest expense of $31,000, The company does not pay a preferred dividend. The tax rate is 21%.

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A firm has EBIT of $80,000 and interest expense of $31,000, The company does not pay a preferred dividend. The tax rate is 21%. At a base EBIT level of $80,000, what is the degree of financial leverage? 2.0 0.4 0.6 O 1.6

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