A Proposed Project Has Fixed Costs of $36,000 Per Year

question 70

Multiple Choice

A proposed project has fixed costs of $36,000 per year.The operating cash flow at 18,000 units is $58,000.What will be the new degree of operating leverage if the number of units sold rises to 18,500?

• A)1.46
• B)1.59
• C)1.67
• D)2.08
• E)2.14

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