One potential benefit of high operating leverage is that it can reduce the average cost per unit at high levels of output,thus generating a competitive cost advantage.

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High operating leverage means that a company has a higher proportion of fixed costs compared to variable costs. At high levels of output, the fixed costs can be spread over a larger number of units, resulting in lower average cost per unit. This can lead to a competitive cost advantage over other companies with lower operating leverage.

One Potential Benefit of High Operating Leverage Is That It