Table 22-19 The 600 Voters of Appleton Are Deciding by Majority Rule

question 192

Multiple Choice

Table 22-19
The 600 voters of Appleton are deciding by majority rule how much to spend on a new library.
-Refer to Table 22-19. The median voter prefers to spend

• A)$2 million.
• B)$3 million.
• C)$3.5 million.
• D)$4 million.

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Definitions:

Operating Leverage

A measure of how revenue growth translates into growth in operating income, indicating the proportion of fixed versus variable costs a company has.

Degree of Operating Leverage

A financial ratio that measures the sensitivity of a company's earnings before interest and taxes (EBIT) to a percentage change in sales, indicating the impact of fixed costs on profits.

High-low Method

The high-low method is an accounting technique used to estimate the variable and fixed costs of a business based on the highest and lowest levels of activity.

Unit Sales Price

The price at which an individual unit of a product is sold, important for determining profitability and setting pricing strategies.