BUSINESS FINANCE I Dersi Cost-Volume-Profit (CVP) Analysis soru detayı:

CEVAP:

A higher DOL implies a higher business risk. For companies with high fixed costs the DOL will be automatically higher. In general, higher fixed costs are observed in technology intensive industries. Although it is not totally possible for a company to control its fixed costs, the management can lower the fixed costs by investing in technologies with higher variable costs. Hence, through capital budgeting decisions, a company can reduce its operating leverage and business risk.