The Degree of Operating Leverage Is Computed as

question 4

Multiple Choice

The degree of operating leverage is computed as

• A) percent change in operating profit divided by percent change in net income.
• B) percent change in volume divided by percent change in operating profit.
• C) percent change in EPS divided by percent change in operating income.
• D) percent change in operating income divided by percent change in volume.

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Definitions:

Punishment

The imposition of a penalty as retribution for an offense, with the intention of correcting behavior or deterring future offenses.

Troubles

Privately felt problems that come from events or feelings in one individual’s life.

Issues

Problems that affect large numbers of people and have their origins in the institutional arrangements and history of a society.

Societal Forces

The various external influences, such as cultural norms, laws, and population dynamics, that affect individuals and shape society.