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The Smith Bakery sells a variety of gourmet breads, cakes, and pastries. Althouth they are more expensive than those available in the supermarkets, they have
| The Smith Bakery sells a variety of gourmet breads, cakes, and pastries. Althouth they are more expensive than those available in the supermarkets, they have a loyal customer base that is willing to pay a premium price. On the average, Smith Bakery has a monthly revenue of $150,000 and earns a profit of $7,500. Their contribution margin ratio is 40%. What is the operating leverage for Smith Bakery? Round off your answer to four digits. |
| A. | 0.6316 | |
| B. | 0.3500 | |
| C. | 0.9500 | |
| D. | 0.0500 | |
| E. | 0.3684 |
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