Which of the following generally indicates a negative change? The asset turnover increases. The financial leverage...
Which of the following generally indicates a negative change?
| The asset turnover increases. |
| The financial leverage decreases. |
| The return on equity increases. |
| The earnings per share increases. |
Homework Answers
Asset turnover increase is the positive change because if asset turnover increase that is favorable..
The return on equity and earning per share increase both are favorable (positive) change.
But when financial leverage decrease the cost of capital increase and market value of company will decrease.
So answer is b) The financial leverage decreases
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