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Firm A has fixed cost of $30,000; variable cost of $31.50 per unit; selling price of...

  1. Firm A has fixed cost of $30,000; variable cost of $31.50 per unit; selling price of 2.50 per unit.

Firm B sells at 2.50 per unit but has $60,000 in fixed costs and variable cost of $1.00 per unit. If both firms have $500,000 in debt at 10 percent; what will be the degree of total leverage at 90,000 units; at 110,000 units of output.

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