Assume the following:
Degree of Operating Leverage (DOL) = 2.4
Degee of Financial Leverage (DFL) = 1.25
Degree of Total Leverage (DTL) = 3
Everything else remaining constant assume the company decides to immediately repay 50% of a bank loan prior to its maturity. How would this affect its DOL.
DFL adn DTL? Please explain why.
The DOL would be expected to: (increase decrease or remain constant) ?
The DFL would be expected to: (increase decrease or remain constant) ?
The DTL would be expected to: (increase decrease or remaint constant) ?
Your email address will not be published. Required fields are marked *
Save my name, email, and website in this browser for the next time I comment.