## Answers

The statement is false which is shown as below:- | |||||||

Operating leverage = (%change in operating income/ % change in sales) | |||||||

= | 5 = %change in operating income / 45% | ||||||

= | %change in operating income = (45*5) = 225% | ||||||

Hence, change in operating income is (20,000*225%) = $45,000 |

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