Question: Consider a four year project with the following information: initial fixed asset =590,000; straight line depreciation to zero over the four year life; zero salavage

Consider a four year project with the following information: initial fixed asset =590,000; straight line depreciation to zero over the four year life; zero salavage value ; price =$34; variable cost= $26; fixed cost =$230,000; quantity sold =89,000 units; tax rate = 35 percent.

What is the degree of operating leverage at the given level of output?

What is the degree of operating leverage at the accounting break-even level of output?

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