Business, 12.08.2021 23:20, ava4460

Atech has fixed costs of $2.9 million and profits of $1 million. Its competitor, ZTech, is roughly the same size and this year earned the same profits, $1 million. However, ZTech operates with fixed costs of $2.47 million and lower variable costs. a. Calculate the operating leverage for each firm. (Round your answers to 2 decimal places.)
DOL ATech
DOL ZTech
b. Which firm will likely have higher profits if the economy strengthens?
ATech
ZTech

Answers: 3

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Atech has fixed costs of $2.9 million and profits of $1 million. Its competitor, ZTech, is roughly t...