If the Proportion of Fixed Costs Increases

question 81

Multiple Choice

If the proportion of fixed costs increases:

• A) DOL falls.
• B) DOL rises.
• C) the NPVbreakeven level of sales declines.
• D) the NPV of the cash flows declines.

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Definitions:

Extrinsic Motivation

Motivation driven by external rewards such as money, fame, grades, or praise rather than internal factors like personal satisfaction or enjoyment of the task itself.

Financial Insecurity

A state of being unsure or having anxiety about one's financial future and stability.

Self-Actualization

The process of realizing and fulfilling one's own potential, capacities, and talents as a way of becoming the most that one can be.

Esteem Needs

According to Maslow, these are the fourth level in the hierarchy of needs, involving the desire for self-esteem, strength, competence, and respect from others.