Question: 1. Why does a conservative approach to operating leverage inhibit a firms profitability? Be sure to directly and succinctly answer the question. Your answer should,

1. Why does a conservative approach to operating leverage inhibit a firms profitability? Be sure to directly and succinctly answer the question. Your answer should, at a minimum, explain the concept of operating leverage and mention the roles of contribution margin and break-even point.

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(3) How does it influence development activity in the organization?

(4) What level of commitment do people have towards the strategy?