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A company has predicted EBIT of $40,000 per year and a degree of operating leverage of 1.3 at the predicted level of sales. 1. What

A company has predicted EBIT of $40,000 per year and a degree of operating leverage of 1.3 at the predicted level of sales.

1. What is the expected percentage change in EBIT if sales turn out to be 5% lower than expected?

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