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Business, 22.01.2020 06:32 VamPL

When comparing levered versus unlevered capital structures, why does leverage work to increase eps for very high levels of earnings before interest and tax (ebit)? a. because interest payments on debt vary with ebit levels such that low ebit leads to the lowest interest payments. b. because interest payments on the debt stay fixed, leaving the remaining income to be distributed among less shares of stockc. because risk units of debt are likely to be lower than risk units assigned to equityd. because other things equal, more taxes are paid under the levered capital structure than under an unlevered capital structuree. because interest payments on debt can be put off until some date in the future such as the date of debt maturity

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