Answer the Following Questions Using the Information Below

question 115

Multiple Choice

Answer the following questions using the information below:
Southwestern College is planning to hold a fund raising banquet at one of the local country clubs. It has two options for the banquet:

Southwestern College has budgeted $1,800 for administrative and marketing expenses. It plans to hire a band which will cost another $800. Tickets are expected to be $30 per person. Local business supporters will donate any other items required for the event.
-Which option provides the greatest degree of operating leverage if 600 people attend?

• A) Option one
• B) Option two
• C) Both options provide equal degrees of operating leverage.
• D) Operating leverage is indeterminable.

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