A fiRm Is Reviewing a Project That Has fiXed Costs

question 14

Multiple Choice

A firm is reviewing a project that has fixed costs of $123,500, variable costs of $189,700, sales of $427,600, and a 34% marginal tax rate. The project has no initial cash requirements. What is the
Degree of operating leverage for this project?

• A) .61
• B) 1.22
• C) 1.61
• D) 1.64
• E) 2.64

---

Definitions:

African Americans

People in the United States with ancestry traced to Africa, especially those whose ancestors were forcibly brought to the US as slaves.

Whites

Refers to individuals of European descent; often used in sociocultural contexts to discuss racial identity and dynamics.

Ethnic Profiling

The use by law enforcement of an individual's race or ethnicity as a key factor in deciding whether to engage in enforcement (e.g., make a traffic stop or arrest).

Religious Profiling

The practice of subjecting people to increased security or scrutiny based on their religion or beliefs, often resulting in discrimination or prejudice.