Question:Now assume that PSC has a fixed operating expense of $400,000, in addition to Business Risk the variable expense of 60 percent of sales, shown as follows:

Power Software Company Forecasts

Probability of Occurrence

2%8%20%40%20%8%2%

Sales$800$1,000$1,400$2,000$2,600$3,0003,200

Variable Expenses4806008401,2001,5601,8001,920

Fixed Expenses400400400400400400400

Recalculate PSC's business risk (coefficient of variation of operating income). How does this figure compare with the business risk calculated with variable cost only?