Question: An analyst projects that company ABCs sales will increase from $1.2 million to $1.4 million. COGS will increase from $600 thousand to $680 thousand, but

An analyst projects that company ABCs sales will increase from $1.2 million to $1.4 million. COGS will increase from $600 thousand to $680 thousand, but fixed costs and depreciation expense should remain steady at $200 thousand and $100 thousand, respectively. Interest paid will increase from $100 thousand to $120 thousand. The firms tax rate will hold steady at 25%. All else being equal, what is the firms degree of operating leverage?

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