If Pretax Profits Decrease by 13

Multiple Choice

If pretax profits decrease by 13.8 percent when the DOL is 3.8, then the decrease in sales is:

A) 0.28 percent
B) 2.75 percent
C) 3.63 percent
D) 10.00 percent DOL =
3) 8 =
3) 8X = -13.8%
X = 3.63%