Donald and Sons Manage a Product with a 3

Multiple Choice

Donald and Sons manage a product with a 3.0 degree of operating leverage. Sales of the product are expected to increase by 10 percent next year. What is the expected change in the operating
Cash flow for this product for next year?

A) 3.3 percent increase
B) 10 percent increase
C) 30 percent increase
D) 10 percent decrease
E) 30 percent decrease