Entities with a higher proportion of fixed costs to variable costs,within their cost structures,compared to entities with a lower proportion of fixed to variable costs,are regarded as:

Question

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Entities with a higher proportion of fixed costs have higher operating leverage, which means that a small change in revenue can lead to a larger change in profits. This makes them more risky as they are more vulnerable to changes in sales or market conditions. On the other hand, entities with a lower proportion of fixed costs have lower operating leverage and are less risky.

Entities with a Higher Proportion of Fixed Costs to Variable