QUESTION 1

Which of the following statements correctly explain the relationships between the degree of operating leverage (DOL), the degree of financial leverage (DFL), and the degree of combined leverage (DCL)?

		DOL = DCL - DFL
		DCL = DOL / DFL
		DFL = DCL / DOL
		DCL = DFL / DOL

QUESTION 2

When we use Excels built-in function PRICE(SETTLEMENT, MATURITY, RATE, YLD,REDEMPTION,FREQUENCY,BASIS) to calculate a bond price, and the variable BASIS indicates the number of bond coupon payments each year.

True

False