If the Price Level in the U

question 134

Multiple Choice

If the price level in the U.S.decreases,aggregate output demanded:

• A)decreases because U.S.products become cheaper relative to foreign products.
• B)decreases because U.S.products become more expensive relative to foreign products.
• C)increases because U.S.products become cheaper relative to foreign products.
• D)increases because U.S.products become more expensive relative to foreign products.
• E)decreases because household wealth and spending in the U.S.decrease.

Understand the concept of operating leverage and its impact on profits with a change in sales volume.

Analyze the effect of sales mix on break-even and target profit points.

Determine the degree of operating leverage based on company income statements.

Apply break-even and target profit concepts across multiple product lines, considering the sales mix.