Detailed Explanation

Let's calculate each metric for Year 1 and Year 2:

1. Basic EPS

Year 1:

• Net income = €58,000
• Weighted average shares = 635,000
• Basic EPS = €58,000 / 635,000 = €0.0913

Year 2:

• Net income = €57,500
• Weighted average shares = 650,000
• Basic EPS = €57,500 / 650,000 = €0.0885

Result: Basic EPS decreased from €0.0913 to €0.0885

2. EBIT Margin

Year 1:

• EBIT = €91,500
• Revenue = €720,000
• EBIT margin = €91,500 / €720,000 = 12.71%

Year 2:

• EBIT = €93,500
• Revenue = €725,000
• EBIT margin = €93,500 / €725,000 = 12.90%

Result: EBIT margin increased from 12.71% to 12.90%

3. Net Profit Margin

Year 1:

• Net income = €58,000
• Revenue = €720,000
• Net profit margin = €58,000 / €720,000 = 8.06%

Year 2:

• Net income = €57,500
• Revenue = €725,000
• Net profit margin = €57,500 / €725,000 = 7.93%

Result: Net profit margin decreased from 8.06% to 7.93%

Conclusion

Only EBIT margin increased from Year 1 to Year 2.

Correct Answer: B