A proposed project has fixed costs of $84,000 per year. The operating cash flow at 7,500 units

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A proposed project has fixed costs of $84,000 per year. The operating cash flow at 7,500 units is $93,000. 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?

Related Book For answer-question

Fundamentals of Corporate Finance

ISBN: 978-0077861629

8th Edition

Authors: Stephen A. Ross, Randolph W. Westerfield, Bradford D.Jordan

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Posted Date: Jul 06, 2018 09:28 AM

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A proposed project has fixed costs of $84,000 per year. The operating cash flow at 7,500 units

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Degree of operating leverage change in EBIT 93000 84000 84000 0107 1071 change in sal... View the full answer

Fundamentals of Corporate Finance

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