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Computation of interest charges using degree of combined leverage.

The second question is -A firm has sales if $10 million variable costs of $5million, EBIT of $2 million and a degree of combined leverage of 3.0 -if the firm has no preferred stock what are its annual interest charges? And if the firm wishes to lower its degree of combined leverage to 2.5 by reducing the interest charges what will be the new level of annual interest charges?

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Basic Finance, Finance

Category:- Basic Finance
Reference No.:- M9160661

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