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Neutral theory proposes that
Operating Leverage
The degree to which a company can increase its profits by increasing sales, reflecting how fixed costs are leveraged against sales volume.
Fixed Expenses
Costs that do not vary with the level of production or sales over a short period, such as rent or salaries.
Cost Structure
The relative proportion of fixed, variable, and mixed costs in an organization.
Advertising Budget
The allocation of funds toward promotional activities intended to communicate the value of products or services to customers.
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