What will profits be if sales turn out

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You estimate that your cattle farm will generate $0.15 million of profits on sales of $3 million under normal economic conditions and that the degree of operating leverage is 2.

a. What will profits be if sales turn out to be $1.5 million? (Leave no cells blank - be certain to enter "0" wherever required. Do not round intermediate calculations. Enter your answers in millions.)

Profit will decrease to $0 million.

b. What will profits be if sales turn out to be $4.5 million? (Do not round intermediate calculations. Enter your answers in millions rounded to 1 decimal place.)

Profit will increase to ____________ million.

Reference no: EM132491070

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