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What does the change in operating leverage

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Reference no: EM133013154

Problem - Assume that Pop Tent had an operating leverage of 2.5 in Year 2 and had an operating leverage of 4.5 in Year 1.

1) What does the change in operating leverage from Year 1 to Year 2 tell you about Pop Tent's proportion of fixed costs from Year 1 to Year 2?

2) Describe how a 1% increase in sales would be projected to impact Pop Tent's operating income in Year 2?

Reference no: EM133013154

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