Download or read book The Magnitude of Sales Changes and Asymmetric Cost Behavior written by Mustafa Ciftci and published by . This book was released on 2018 with total page pages. Available in PDF, EPUB and Kindle. Book excerpt: We investigate the impact of the magnitude of current sales changes on asymmetric cost behavior. We expect that managers are likely to consider small (large) current sales decreases as temporary (permanent). Therefore, they will be less (more) likely to cut costs for small (large) current sales decreases. Accordingly, we predict and find that, conditional on prior sales increase, cost stickiness is greater for small current sales changes than that for large current sales changes. In addition, prior research suggests that, conditional on prior sales decrease, slack resources retained from the prior period might lead to cost anti-stickiness. We expect that slack resources retained from the prior period will have a greater (smaller) impact on cost behavior for small (large) current sales changes. Accordingly, we predict and find that, conditional on prior sales decrease, cost anti-stickiness is greater for small current sales changes than that for large current sales changes.