A Firm Which Has a 2

question 6

Multiple Choice

A firm which has a 2.5 DOL (degree of operating leverage) would find that an 8% increase in EBIT would result from a increase in sales.

• A)3.2%
• B)5.4%
• C)20.0%
• D)2.0%

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Definitions:

Central Assumptions

Fundamental beliefs or ideas that are taken for granted at the base of an argument, theory, or policy.

Cognitive Theory

A theory focusing on the understanding of mental processes such as perception, memory, thought, and problem solving.

Task at Hand

This phrase refers to the immediate job, work, or activity that requires attention or completion without delay.

Behavioral Theorist

A scholar who studies and contributes to the understanding of behaviors by emphasizing the effects of learning and environment on actions.