Which of the following is true of leverage? A) It refers to the effec

Which of the following is true of leverage?

A) It refers to the effects that operating and financial fixed costs have on the returns that shareholders earn.
B) It is associated with risks which are out of the control of managers.
C) It includes the effect of operating fixed costs on the returns of shareholders and not the financial fixed costs.
D) It is used to evaluate the profitability associated with various levels of sales.

ANSWER

A