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A proposed project has fixed costs of $39,000 per year. The operating cash flow at 14,000 units is $81,000. a. Ignoring the effect of taxes,
A proposed project has fixed costs of $39,000 per year. The operating cash flow at 14,000 units is $81,000.
a. Ignoring the effect of taxes, what is the degree of operating leverage? |
b. If units sold rise from 14,000 to 14,500, what will be the increase in operating cash flow? |
c. What is the new degree of operating leverage? |
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