Question: View HUP 8 X cut Paste Copy Calibri 11 A A = = = - > General 29 Wrap Text Merge & Center 3 format

View HUP 8 X cut Paste Copy Calibri 11 A A = = = - > General 29 Wrap Text Merge & Center 3 format Painter B Clipboard X Font % 9 Number % 5 Formatting St Alignment 816 Table Styles for IK L M N 2 The following table summarizes the percentage changes in operating income, percentage changes in revenue and betas for four pharmaceutical firms. Firm % Change in Revenue Beta Firm A Firm B Firm C Firm D % Change in Operating Income 27% 25% 25% 23% 36% 21% 40% 32% 1.15 8 1.4 a. Calculate the degree of operating leverage for each of these firms. b. Use the operating leverage to explain why these firms have different betas. INSTRUCTIONS 1 2 3 4 5 | 6 | 7 | 8 | 9 | 10
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