The Degree of Operating Leverage Is Defined as the Percentage

question 412

Multiple Choice

The degree of operating leverage is defined as the percentage change in _____ relative to the percentage change in _____.

• A) net income; fixed costs
• B) net income; total revenue
• C) operating cash flow; fixed costs
• D) operating cash flow; total revenue
• E) operating cash flow; quantity sold

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Definitions:

Product Availability

A measure of the extent to which goods are in stock and accessible for purchase by customers, often critical for customer satisfaction and sales performance.

Total Profits

The entirety of financial gain accumulated by a business after subtracting all expenses from total revenue.

Expected Revenue

The amount of money a company anticipates receiving from sales or other income sources during a specific period, based on forecasts or historical performance.

Lower Price Buyer

A lower price buyer is a consumer or entity that prioritizes purchasing goods or services at the lowest available prices, often influencing market competition and pricing strategies.