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(1) Determine the operating leverage. (2 marks) (2) Determine the financial leverage. (1 mark) (3) Calculate the combined leverage. (1 mark) (4) The owners of

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(1) Determine the operating leverage. (2 marks) (2) Determine the financial leverage. (1 mark) (3) Calculate the combined leverage. (1 mark) (4) The owners of the company intend to automate the company and reduce variable costs to $200,000. Fixed costs will increase by $20,000. Finance costs will increase from $25,000 to $30,000. Calculate the revised operating leverage. ( 2 marks)

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