Adding Depreciation to Net National Product Yields

question 44

Multiple Choice

Adding depreciation to net national product yields

• A)disposable income (DI).
• B)personal income (PI).
• C)net national product (NNP).
• D)gross domestic product (GDP).

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Definitions:

Operating Leverage

Operating leverage describes the extent to which a company can increase profits by increasing sales, indicating the proportion of fixed costs to variable costs.

Break-Even Point

The level of output or sales at which a company does not make a profit or loss, but all costs are covered.

Operating Leverage

measures a company's fixed costs relative to its total costs, indicating how a change in sales will affect its operating income.

Forecasting Error

Forecasting error refers to the difference between actual outcomes and previously predicted values, directly impacting planning and decision-making.