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Operating Leverage
A measure of how sensitive a company's operating income is to changes in its sales volume, indicating the impact of fixed costs on earnings.
Fixed Production Costs
Costs that do not change with the level of production or output, such as rent, salaries, and insurance premiums, which a company must pay regardless of its level of production.
Contribution Margin
The selling price per unit, minus the variable cost per unit, indicating how much a product contributes towards covering fixed costs and generating profit.
Simulation Analysis
A process of modeling a real-world system or process through a computer program to study its behavior under various conditions.
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