2A2G A DEGREE OF OPERATING LEVERAGE OF 3 AT 5,000 UNITS MEANS THAT A...
39.
CSO: 2A2b
LOS: 2A2g
A degree of operating leverage of 3 at 5,000 units means that a
a.
3% change in earnings before interest and taxes will cause a 3% change in sales.
b.
3% change in sales will cause a 3% change in earnings before interest and taxes.
c.
1% change in sales will cause a 3% change in earnings before interest and taxes.
d.
1% change in earnings before interest and taxes will cause a 3% change in sales.