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Youve been asked to compare two different companies, one of which has higher variable costs and lower fixed costs, and the other which has lower
Youve been asked to compare two different companies, one of which has higher variable costs and lower fixed costs, and the other which has lower variable costs and higher fixed costs. Regarding this comparison, which of the following two terms are correctly paired?
A : Higher contribution margin ratio; higher degree of operating leverage.
B : Lower degree of operating leverage; higher break-even point.
C : Lower contribution margin ratio; higher degree of operating leverage.
D : Higher margin of safety ratio; higher break-even point.
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