Lincoln Lodging Inc

question 15

Multiple Choice

Lincoln Lodging Inc.estimates that if its sales increase 10% then its net income will increase 18%.The company's EBIT equals $2.4 million,and its interest expense is $400,000.The company's operating costs include fixed and variable costs.What is the level of the company's fixed operating costs?

• A)$1,083,000
• B)$1,140,000
• C)$1,200,000
• D)$1,260,000
• E)$1,323,000

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Definitions:

Price Competition

A market situation where businesses compete primarily on the price of their products or services.

Music Production Industry

The sector of the economy dedicated to creating, producing, and distributing music and sound recordings.

Airline Industry

A sector of the economy composed of companies and organizations involved in the business of transporting passengers and cargo by aircraft.

Complex Interdependence

Complex interdependence reflects a situation in international relations where states and their fortunes are interconnected through multiple channels, diminishing the relevance of military power.