Which organisation is more likely to be highly operationally geared?

Question

Quizplus · Accepted Answer

Operational gearing refers to the ratio between fixed costs and variable costs. Organizations with high fixed costs are likely to be highly operationally geared. Vehicle manufacturing requires significant investment in fixed assets, machinery, and technology, making it a capital-intensive industry with high fixed costs. On the other hand, internet service providers, takeaway food outlets, and hairdressers have comparatively lower fixed costs and higher variable costs, making them less operationally geared.

Which Organisation Is More Likely to Be Highly Operationally Geared