Operating leverage measures how sensitive a company's operating profit is to changes in revenue. High fixed costs relative to variable costs create high operating leverage — a small revenue increase produces a large profit increase, and vice versa.
💡
Pro Tip
High operating leverage is a double-edged sword. It amplifies gains in good times but magnifies losses in downturns. Companies with high leverage need conservative balance sheets.
⭐
Did You Know?
Airlines have extremely high operating leverage — fixed costs (aircraft, staff, gates) are massive. A 5% revenue drop from an empty seat can wipe out most profit; a 5% increase can double profits.
References
🔒
100% ఉచితం
సైన్ అప్ అవసరం లేదు
✓
ఖచ్చితమైన
ధృవీకరించబడిన సూత్రాలు
⚡
తక్షణమే
టైప్ చేసేటప్పుడు ఫలితాలు
📱
మొబైల్ రెడీ
అన్ని పరికరాలు