OceanGate sells external hard drives for $294 each. Its totalfixed costs are $23 million, and its variable costs per unit are$191. The corporate tax rate is 32%. If the economy is strong, thefirm will sell 2 million drives, but if there is a recession, itwill sell only half as many.

a. What will be the percentage decline in salesif the economy enters a recession? (Negative value shouldbe indicated by a minus sign. Round your answer to2 decimal places.)

b. What will be the percentage decline inprofits if the economy enters a recession? (Negative valueshould be indicated by a minus sign. Round your answer to 2 decimalplaces.)

c. Calculate the operating leverage of thisfirm? (Round your answer to 2 decimal places.)

OceanGate sells external hard drives for $294 each. Its totalfixed costs are $23 million, and its variable costs per unit are$191. The corporate tax rate is 32%. If the economy is strong, thefirm will sell 2 million drives, but if there is a recession, itwill sell only half as many.

a. What will be the percentage decline in salesif the economy enters a recession? (Negative value shouldbe indicated by a minus sign. Round your answer to2 decimal places.)

b. What will be the percentage decline inprofits if the economy enters a recession? (Negative valueshould be indicated by a minus sign. Round your answer to 2 decimalplaces.)

c. Calculate the operating leverage of thisfirm? (Round your answer to 2 decimal places.)