If a firm has the lowest possible degree of operating leverage and the lowest possible degree of financial leverage, then Select one: DOL equals 0, and DFL equals 1 DOL equals 1, and DFL equals 0 DOL equals 1, and DFL equals 1 DOL equals 0, and DFL equals 0 For Al Mazrook Ltd, holding other factors constant, ordering costs per unit generally Select one: decline as average inventory increases increase in proportion to increases in inventory are negotiated are considered fixed costs The Chief Financial Officer of your company seeks your advice about the use of financial leverage. Under which of the following conditions could the excessive use of financial leverage be harmful to your company? Select one: Low interest cost compared to return on assets stable industry Cyclical demand for the firm's products Upswing of business cycle If sales volume exceeds the break-even point, the firm will experience Select one: an operating loss an increase in plant and equipment an operating profit an increase in stock price Your Finance Manager asks you to manage 'cash and marketable securities' segment of the company. As person-in-charge of this segment, what should be your primary concern? Select one: Maximization of liquid assets Liquidity and safety Acceptable return on investment Maximization of profit The three primary policy variables to consider when extending credit does not include: Select one: O the level of interest rates credit standards the terms of trade collection policy Which of the following questions does break-even analysis attempt to address? i) How much do changes in volume effect costs and profits? ii) At what point does the firm break even? What is the most inefficient level of fixed assets to employ? Select one: (6) & (ii) (0) & (iii) 00). (i) & (ii) (ii) & (iii) Which of the following is not subtracted out in arriving at operating income? A) interest expense B) cost of goods sold C) depreciation D) selling and administrative expense Select one: B All of the following are benefits of just-in-time inventory ordering systems except A) reduces warehouse space. B) saves utility and manpower costs. C) reduces inventory costs. D) prevents stock outs. Select one: A B C D Disinflation may cause A) an increase in the value of gold, silver, and gems. B) a reduced required return demanded by investors on financial assets. C) additional profits through falling inventory costs. D) None of the above Select one: B