Assume Sales Volume of 3,000 Units, Unit Variable Cost of $3

question 15

Multiple Choice

Assume sales volume of 3,000 units, unit variable cost of $3, fixed costs of $15,000.What is operating leverage?

• A)60%
• B)37.5%
• C)20%
• D)62.5%
• E)1.6%

---

Definitions:

Total Costs

The sum of all costs associated with producing a good or service, including both fixed and variable costs.

Industry Expansion

The growth or increase in size and operations of an industry due to higher demand, technological advancements, or other factors.

Positive Revenues

Positive revenues refer to the income generated from sales, services, or other business activities before any expenses are subtracted, indicating a gross inflow of economic benefits.

Resources Move

Resources Move describes the reallocation or mobility of resources (labor, capital, etc.) from one sector, location, or use to another.