Figure 4-6

question 72

Multiple Choice

Figure 4-6. Shorter Company had originally expected to earn operating income of $130,000 in the coming year.Shorter's degree of operating leverage is 2.4.Recently,Shorter revised its plans and now expects to increase sales by 20% next year.
Refer to Figure 4-6.What is Shorter's revised expected operating income for the coming year?

• A)$192,400
• B)$156,000
• C)$312,000
• D)$130,000
• E)$62,400

---

Definitions:

Escalating Conflict

The process by which disagreements or disputes grow in intensity or severity, often resulting in more serious confrontations if unchecked.

Limited Searching

A behavior in which individuals or organizations search for information in a restricted manner, often settling for satisfactory solutions rather than the optimal ones.

Escalating Commitment

Escalating Commitment refers to the tendency to continue to invest time, money, or resources into a decision or project despite evidence of it being unwise or failing, often driven by emotional attachment or sunk costs.

Course Of Action

Refers to a plan or strategy intended to accomplish a specific goal.