At an output level of 50,000 units,you calculate that the degree of operating leverage is 1.8.What will be the percentage change in operating cash flow if the new output level is 54,500 units?
A)5.00 percent
B)6.17 percent
C)16.20 percent
D)17.43 percent
E)20.00 percent

Question

Quizplus · Accepted Answer

DOL = 1.8 = Percentage change in OCF/[54,500 - 50,000)/50,000]; %ΔOCF = 16.20 percent

At an Output Level of 50,000 Units,you Calculate That the Degree