Question
Modern Artifacts can produce keepsakes that will be sold for $87 each. Nondepreciation fixed costs are $1,700 per year, and variable costs are $60 per
Modern Artifacts can produce keepsakes that will be sold for $87 each. Nondepreciation fixed costs are $1,700 per year, and variable costs are $60 per unit. The initial investment of $3,100 will be depreciated straight-line over its useful life of five years to a final value of zero, and the discount rate is 10%.
What is the degree of operating leverage of Modern Artifacts when sales are $8,265?
Note: Round your answer to 1 decimal place.
What is the degree of operating leverage when sales are $13,485?
Note: Round your answer to 1 decimal place.
a. Degree of operating leverage _____________ times
b. Degree of operating leverage ______________ times
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