A Project Has an Estimated Sales Price of $71 Per

Multiple Choice

A project has an estimated sales price of $71 per unit, variable costs of $44.03 per unit, fixed costs of $57,000, a required return of 14 percent, an initial investment of $79,500, no salvage value, and a life of four years. Ignore taxes. What is the degree of operating leverage at the financial break-even level of output?

A) 2.72
B) 3.09
C) 2.53
D) 3.03
E) 1.48