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A proposed project has fixed costs of $48,000 per year. The operating cash flow at 16,000 units is $85,000. a. Ignoring the effect of taxes,

A proposed project has fixed costs of $48,000 per year. The operating cash flow at 16,000 units is $85,000.

a. Ignoring the effect of taxes, what is the degree of operating leverage?

b. If units sold rise from 16,000 to 16,200, what will be the increase in operating cash flow?

c. What is the new degree of operating leverage?

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