The Degree of Operating Leverage Has Which of the Following

question 11

Multiple Choice

The degree of operating leverage has which of the following characteristics?

• A) A change in quantity demanded will produce the same percentage change in EBIT as an identical change in price per unit of output, other things held constant.
• B) The DOL relates the change in net income to the change in operating income.
• C) If the firm has no debt, the DOL will equal 1.
• D) The closer the firm is operating to the breakeven quantity, the smaller the DOL.
• E) The DOL is not a fixed number for a given firm, but will depend upon the time zero values of the economic variable Q (Quantity), P (Price), and V (Volume).

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Definitions:

Mothering Style

The distinctive approach or method that a mother uses in raising her offspring, influencing their psychological and emotional development.

Male Dominance

A social system in which males hold primary power and predominate in roles of political leadership, moral authority, social privilege, and control of property.

Anthropomorphic

Attributing human characteristics or behaviors to animals, gods, or inanimate objects.

Pheromones

Chemical substances produced and released into the environment by an animal, affecting the behavior or physiology of others of its species.