A small group of investors using borrowed funds to purchase all the shares of a publicly traded company is called:

a. initial public offering

b. equity carve-out

c. leveraged buyout

d. underwriting

The higher a firms DOL, the more it will tend to rely on non-fixed obligation financing such as common stock.

True

False

The break-even point will decline, if there are not as many fixed operating expenses to cover.

True

False

1. Total variable costs are $15,000, sales $50,000, and fixed costs $15,000. Calculate DOL.

   	a.	1.75
   	b.	0.69
   	c.	1.45
   	d.	2