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Joyce Murphy runs a courier service in downtown Seattle. She charges clients $ 0 . 5 6 per mile driven. Joyce has determined that if

Joyce Murphy runs a courier service in downtown Seattle. She charges clients $0.56 per mile driven. Joyce has determined that if she drives 3,200 miles in a month, her total operating cost is $732. If she drives 5,600 miles in a month, her total operating cost is $996. Joyce has used the high-low method to determine that her monthly cost equation is total monthly cost = $380+ $0.11 per mile driven.
Required:
Determine how many miles Joyce needs to drive to break even.
Calculate Joyces degree of operating leverage if she drives 5,800 miles.
Suppose Joyce took a week off and her sales for the month decreased by 23 percent. Using the degree of operating leverage, calculate the effect this will have on her profit for that month.

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