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Both Apple and Google sell electronic devices, and each of these companies has a different product mix. Apple Google Average selling price per unit sold
Both Apple and Google sell electronic devices, and each of these companies has a different product mix.
| Apple | |
Average selling price per unit sold | $550 per unit | $470 per unit |
Average variable cost per unit sold | $250 per unit | $270 per unit |
Total fixed costs ($ in millions) | $ 36,000 | $ 10,000 |
If unit sales were to decline, which company would experience the larger decline in operating profit? Explain. Please include in your answer an explanation of how degree of operating leverage works.
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