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A company has an EBIT of $2.5 million with an interest expense of $800,000 and preferred dividends of $700,000. Its tax rate is 35%. What

A company has an EBIT of $2.5 million with an interest expense of $800,000 and preferred dividends of $700,000. Its tax rate is 35%. What is the company's degree of operating leverage? I know the answer is 4.01 but I am not sure how to correctly work the problem.

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