Higher Operating Leverage

question 4

Multiple Choice

Higher operating leverage:

• A) Should be lowered
• B) Increases risk of loss if operations are near the breakeven point
• C) Reduces risk of loss if operations are near the breakeven point
• D) Does not affect the risk of loss regardless of the level of operations

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Definitions:

Support

The assistance or encouragement provided by individuals or organizations to others, which can be emotional, social, financial, or practical.

Encouragement

The action of giving someone support, confidence, or hope to motivate positive outcomes or behaviors.

Realistic Expectations

Anticipations or beliefs about future events or results that are based on practical and factual grounds, rather than on wishful thinking or idealism.

Communication

The exchange of information, thoughts, messages, or emotions between individuals or groups through spoken words, writings, behaviors, or symbols.