If a Company Has a Degree of Operating Leverage of 3.0

question 208

Multiple Choice

If a company has a degree of operating leverage of 3.0 and sales increase by 25%,then ________.

• A) total fixed costs will increase by 75%
• B) total costs will increase by 75%
• C) profit will increase by 30%
• D) profit will increase by 75%

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Definitions:

Skin Breakdown

The deterioration of skin integrity, commonly caused by pressure or friction, leading to ulcers or wounds.

Sleeping Aid

Refers to medications or natural substances used to improve the quality or duration of sleep in individuals with insomnia or sleep disturbances.

Evening Care

Routine care tasks performed in the evening to prepare a person for a comfortable night’s sleep.

Arousal

The physiological and psychological state of being awake, alert, and oriented, often in anticipation of or in response to stimuli.