Introduction of the term Operating Leverage
Give a brief introduction of the term Operating Leverage?
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It is a leverage that refers to the improvement of profits since there is a fixed operating cost that is involved with each component. When the sales raises fixed cost does not raise and it results in higher profits. Higher fixed expenditures results in higher operating leverages that leads to higher business risks.
Perfect competition is characterized by all of the following except w) heavy advertising by individual sellers. x) homogeneous products. y) sellers are price takers. z) a horizontal demand curve for individual sellers. Q : Define Direct and inverse relationships Define Direct and inverse relationships?
Define Direct and inverse relationships?
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