The Lincoln Mint produces various types of one ounce silver commemorative medals for sale to collectors. The cost of producing and selling a given medal is as follows:

Fixed costs

Design and preparation of dies $ 8,000

Promotion and selling expenses 25,000

Administrative overhead 7,000

Total $40,000

Variable costs per unit

Silver blanks $ 6.00

Striking medals 0.50

Mailing expenses 3.50

Total $10.00

Projected selling price per unit $14.00

Note: Interest, taxes and preferred dividends are $0.

A. What is the Degree of Operating Leverage (DOL) at an output level of 15,000 units?

B. What is the Degree of Total Leverage (DTL) at an output level of 15,000 units?

C. USING YOUR ANSWER TO (A.) (in other words do NOT prepare a new income statement), what would be the resulting EBIT if sales DECREASED 15%?