Last Year Avator's Operating Income (EBIT)increased by 22 Percent While

question 5

Multiple Choice

Last year Avator's operating income (EBIT) increased by 22 percent while its dollar sales increased by 15%. What is Avator's degree of operating leverage (DOL) ?

• A).68
• B)2.0
• C)1.47
• D).32

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Definitions:

Functions of Money

Money serves as a medium of exchange, a unit of account, a store of value, and occasionally, a standard of deferred payment.

Fractional Reserve Banking

A banking system in which banks keep a fraction of deposits as reserves and use the remainder for loans.

Bank Liabilities

Financial obligations owed by a bank to its depositors, creditors, and other parties.

Bank Assets

Resources owned by a bank, including loans, securities, cash, and property, that have economic value and can be used to meet its liabilities.