Consider a four-year project with the following information: initial fixed asset investment = $475,000; straight-line depreciation to zero over the four-year life; zero salvage value; price = $26; variable costs = $18; fixed costs = $195,000; quantity sold = 84,000 units; tax rate = 34 percent. (16 points)

a. How sensitive is OCF to changes in quantity sold? (8 points)

b. What is the degree of operating leverage at the accounting break-even level of output? (8 points)