Costs that do not change with the volume of goods produced are called fixed costs. For example in a steel company, the cost of machinery is fixed and does not vary based on the amount of steel produced.
Aug 06 2012 12:53 PM
Operative leverage indicates how much of revenue flows down into net profits. High operating leverage companies like Google have almost 30-35% of revenue that translates to net profit, whereas low operating leverage companies such as amazon have less than 10% that flows down to net profits