Which of the Following Mathematical Equations Is Used to Calculate

question 39

Multiple Choice

Which of the following mathematical equations is used to calculate the degree of operating leverage (DOL) ? (Δ = change)

• A)DOL = % Δ in net operating income (NOI)/% Δ in sales
• B)DOL = % Δ in sales/% Δ in earnings before taxes (EBT)
• C)DOL = % Δ in earnings before interest and taxes (EBIT)/% Δ in earnings per share (EPS)
• D)DOL = % Δ in sales/% Δ in earnings per share (EPS)
• E)DOL = % Δ in earnings per share (EPS)/% Δ in earnings before taxes (EBT)

Understand the dynamics and consequences of union membership decline in the labor market.

Comprehend the economic principles governing labor demand and supply in both competitive and non-competitive markets.

Analyze the role of right-to-work laws in shaping labor union formation and union membership.

Calculate the marginal resource cost in a labor market situation.

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Definitions:

ABC System

Stands for Activity-Based Costing system, a method of allocating overhead and indirect costs to specific products or services based on their consumption of resources.

Prime Cost

Direct materials plus direct labor costs.

Machine Hours

The total number of hours that machines are used or operated during a specific time period, often used as a basis for allocating manufacturing overhead.

Direct Labor Hour

A measure of the time spent by workers manufacturing a product or delivering a service.