a. Find the depreciation for Case 1.

b. Find the unit price for Case 2.

c. Find the unit variable cost for Case 3.

2.

At an output level of 15,000 units, you have calculated that the degree of operating leverage is 3.2. The operating cash flow is $19,500 in this case.

a. Ignoring the effect of taxes, what are fixed costs?

b. What will the operating cash flow be if output rises to 17,000 units?

c. What will the operating cash flow be if output falls to 14,500 units?

3

Consider each of the following cases