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Modern Artifacts can produce keepsakes that will be sold for $86 each. Nondepreciation fixed costs are $1,600 per year, and variable costs are $50 per
Modern Artifacts can produce keepsakes that will be sold for $86 each. Nondepreciation fixed costs are $1,600 per year, and variable costs are $50 per unit. The initial investment of $3,600 will be depreciated straight-line over its useful life of five years to a final value of zero, and the discount rate is 12%. a. What is the degree of operating leverage of Modern Artifacts when sales are $6,020 ? (Round your answer to 1 decimal place.) b. What is the degree of operating leverage when sales are $11,180 ? (Round your answer to 1 decimal place.)
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