When using PowerPoint during a presentation, slides should be brief and complement the spoken message

If bond and stock markets are efficient, then the timing of when to issue debt or equity should not matter

Indicate whether the statement is true or false

Which of the following statements about combined (operating & financial) leverage is true?

A) Usage of both operating and financial leverage reduces a firm's risk. B) If a firm employs both operating and financial leverage, any percent change in sales will produce a larger percent change in earnings per share. C) A firm that is in a capital-intensive industry should use a higher level of financial leverage than a firm that employs low levels of operating leverage. D) High operating leverage and high financial leverage offset one another, meaning that if sales increase by 10%, then EPS will also increase by 10%.