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When a Firm Increases Its Degree of Operating Leverage by Substituting

question 80

True/False

When a firm increases its degree of operating leverage by substituting fixed costs for variable costs,it normally does so to decrease its breakeven point and to increase its profit.


Definitions:

Bodily Kinesthetic Intelligence

One of Howard Gardner's multiple intelligences, referring to the capacity to manipulate objects and use physical skills effectively, often seen in athletes and dancers.

Howard Gardner

An American developmental psychologist best known for his theory of multiple intelligences, proposing that people have different kinds of intelligences.

Athlete

An individual who competes in sports or engages in physical exercise regularly.

Spatial Intelligence

The ability to visualize, manipulate, and analyze objects and their spatial relationships in the mind.

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