How can we compute operating leverage
How can we compute operating leverage?
Expert
Operating leverage is highest in companies that got fixed operating cost for variable operating cost. It tells investor about the company’s situation and the risk profile of the company. It is evaluated when a company has fixed costs that are apart from the sales volume. When company has fixed cost then the percentage change in profits due to changes in sales volume is larger than the percentage change in sales. The calculation of this is named as degree of operating leverage (or DOL) that gives the extent to that operating profits change as sales volume changes. DOL (or Degree of operating leverage) = percentage change in income / percentage change in sale.
The expected losses to workers by shirking are increased while a firm adopts a policy of: (1) dividing productive tasks therefore the division of labor is optimal. (2) paying efficiency wages that exceed market-clearing wages. (3) avoiding legal liability from not wri
Give a brief introduction of the term Operating Leverage?
Give a brief introduction of the term Cost of capital?
Describe briefly high financial leverage, low operating leverage?
Q X= 600- 6PX + 20I +0.4PY c. Suppose PX increases by 10%, by what percentage would sales decrease? Explain how this price increase affect total revenues from good X.
Computing the cost of college education like the cost of books, tuition and materials, room as well as board, and spending money: (i) overstates the economic cost of a college education. (ii) accurately measures the economic cost of a college educatio
Question: a. In the short-run, it is easier for a country to maintain a peg that undervalues a currency (relative to the equilibrium market rate) than it is to maintain a peg that overvalues the currency (relative
Briefly describe the term cost of capital and also illustrate out its significance?
simultaneous method in demand forecasting?
What are the determinants of supply?
18,76,764
1961050 Asked
3,689
Active Tutors
1455857
Questions Answered
Start Excelling in your courses, Ask an Expert and get answers for your homework and assignments!!