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Which of the following statements is true about operating leverage of a firm? It is the portion of stockholders' risk, over and above basic business
- Which of the following statements is true about operating leverage of a firm?
- It is the portion of stockholders' risk, over and above basic business risk.
- It refers to the extent to which fixed-income securities (debt and preferred stock) are used in a firm's capital structure.
- It refers to the presence of fixed operating costs that do not change when the level of sales changes.
- It is the ability to borrow money at a reasonable cost when good investment opportunities arise.
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