If a Company Has a Degree of Operating Leverage of 5

question 136

Multiple Choice

If a company has a degree of operating leverage of 5 and sales increase by 30%, then ________.

• A) total fixed costs will increase by 150%
• B) total costs will increase by 150%
• C) profit will increase by 120%
• D) profit will increase by 150%

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Definitions:

Psychoneuroimmunology

An interdisciplinary field that studies the interactions between the nervous system and the immune system, and how psychological factors can affect physical health.

Psychological Factors

Pertains to the mental influences that affect an individual's behavior, emotions, and thoughts, including attitudes, beliefs, and motivation.

Immune System

A complex network of cells, tissues, and organs that work together to defend the body against attacks by foreign invaders such as bacteria, viruses, and parasites.

Motor Neurons

Nerve cells that transmit signals from the central nervous system to muscles or glands, leading to action or movement.