The Operating Leverage Factor Indicates the Percentage Change in Operating

question 72

True/False

The operating leverage factor indicates the percentage change in operating income that will occur from a 1% change in volume.

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Definitions:

Incentive

A thing that motivates or encourages someone to do something, often seen as a reward or punishment scheme in behavioral psychology.

Drive

An inner motivation or urge that propels an individual to act or achieve certain goals.

Optimal Stimulation

A psychological theory proposing that individuals seek an optimal level of arousal, with too little leading to boredom and too much resulting in stress.

Arousal Theory

The theory that optimal performance and psychological arousal are related in a way that differs as a function of the individual and the task.