Question: A company s sensitivity analysis shows that a 5 % increase in total fixed costs would require a 1 0 % increase in sales volume

A companys sensitivity analysis shows that a 5% increase in total fixed costs would require a 10% increase in sales volume to maintain current profit levels. What does this imply about the companys cost structure?
Question 3Select one:
a.
The company has a high proportion of variable costs.
b.
The company operates with high economies of scale.
c.
The company has a high proportion of fixed costs.
d.
The company is heavily reliant on outsourcing.

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