Other Things Held Constant,a High Degree of Operating Leverage Will

question 11

True/False

Other things held constant,a high degree of operating leverage will mean that a relatively small change in sales will result in a large change in operating income.

---

Definitions:

Least Cost

The principle of choosing the option that provides the necessary level of benefit or utility at the minimum possible cost.

Production

The process of combining various material inputs and immaterial inputs (plans, know-how) to make something for consumption.

Constant-cost Industry

An industry in which the costs of production do not change as the industry's total output changes.

Competitive Market

A market where there are many buyers and sellers so that no single buyer or seller can influence the price or market conditions.