Hedge Fun Is a Landscaping Firm That Specializes in Topiary

Multiple Choice

Hedge Fun is a landscaping firm that specializes in topiary.It contracts with the owners of 125 local homes and provides its service at an annual fee of $1,300.Its average variable cost is $800,and its annual fixed cost is $28,000.What is the degree of operating leverage?

A) 2.7.
B) 2.1.
C) 1.8.
D) 1.3.
E) None of the above.