A proposed project has fixed costs of $84,000 per year. The operating cash flow at 7,500 units is $93,200. Ignoring the effect of taxes, what is the degree of operating leverage? If units sold rise from 7,500 to 8,000, what will be the increase in operating cash flow? What is the new degree of operating leverage?
Answer to relevant QuestionsAt an output level of 15,000 units, you have calculated that the degree of operating leverage is 2.61. The operating cash flow is $57,000 in this case. Ignoring the effect of taxes, what are fixed costs? What will the ...Consider a project to supply Detroit with 25,000 tons of machine screws annually for automobile production. You will need an initial $3,600,000 investment in threading equipment to get the project started; the project will ...For each of the following, compute the presentvalue:Referring to the TMCC security we discussed at the very beginning of the chapter:a. Based on the $24,099 price, what rate was TMCC paying to borrow money?b. Suppose that, on March 28, 2019, this security’s price is ...An investment offers $6,100 per year for 15 years, with the first payment occurring one year from now. If the required return is 6 percent, what is the value of the investment? What would the value be if the payments ...
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