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NEW QUESTION: 1
If a firm uses debt financing (Debt ratio = 0.40) and sales change from the current level, which of the following statements is most correct?
A. The percentage change in net operating income (EBIT) resulting from the change in sales will exceed the percentage change in net income (NI).
B. The percentage change in net income relative to the percentage change in sales (and in EBIT) will not depend on the interest rate paid on the debt.
C. Since debt is used, the degree of operating leverage must be greater than 1.
D. The percentage change in EBIT will equal the percentage change in net income.
E. The percentage change in net operating income will be less than the percentage change in net income.
Answer: E
Explanation:
Explanation/Reference:
Explanation:
The greater the use of fixed assets, the more sensitive EBIT will be to changes in sales. Interest charges on debt are included in net income and not operating income, as the use of debt financing will have an impact on net income when sales change.

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A customer wants to trade in older 802.11a/b/g access points for new 802.11n access points. What must be considered before deploying new 802.11n access points?
A. 5-GHz coverage is needed when expecting 300-450 Mbps client link.
B. Fewer APs are needed because 802.11n runs on a different radio frequency.
C. Fewer access points are needed because 802.11n has better coverage.
D. New APs should bundle channels 1, 6, and 11 to increase throughput to 150 Mbps.
Answer: A