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    Practical Financial Management Study Set 1
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    Exam 14: Capital Structure and Leverage
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    If a Company Sells 10,000 Units at $25 Each, Has
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If a Company Sells 10,000 Units at $25 Each, Has

Question 115

Question 115

Multiple Choice

If a company sells 10,000 units at $25 each, has fixed costs of $20,000, and a variable cost of $20 per unit, what is its degree of operating leverage (DOL) ?


A) 1.67
B) 2.5
C) 2.0
D) 1.6

Correct Answer:

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