Chicken Company$$s fixed operating costs are $$6\mathrm{.}0$ million and total variable

operating costs are $$3\mathrm{.}0$ million. The firm has $$2$ million in bonds outstanding with a coupon

interest rate of $8$ percent. Evans has $10,000$ shares of preferred stock outstanding, which pays

a $$1\mathrm{.}00$ annual dividend. There are $80,000$ shares of common stock outstanding. Revenues

for the firm are $$10$ million, and the firm is in the $26$ percent corporate income tax bracket.

a$.$ Compute Evans$$ degree of operating leverage and interpret its value.

b$.$ Compute its degree of financial leverage and interpret its value.