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1 . A project has fixed costs of $ 8 4 , 0 0 0 a year. The operating cash flow is $ 9 3

1. A project has fixed costs of $84,000 a year. The operating cash flow is $93,200 at the
7,500 units level. Assuming no taxes, what is the degree of operating leverage? If units
sold rise from 7,500 to 8,000, what will be the increase in operating cash flow? What is
the new degree of operating leverage? (5 points)

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