Business Applications Operating leverage
Description of Business for Amazon.com, Inc.
Amazon.com opened its virtual doors on the World Wide Web in July 1995 and we offer Earth’s Biggest Selection. We seek to be Earth’s most customer-centric company for three primary customer sets: consumer customers, seller customers and developer customers. In addition, we generate revenue through co-branded credit card agreements and other marketing and promotional services, such as online advertising.
Amazon.com | 2008 | 2007 |
Operating revenue | $19,166 | $14,835 |
Operating earnings | 842 | 655 |
Description of Business for CSX, Inc.
CSX Corporations ("CSX") together with its subsidiaries (the "Company"), based in Jacksonville, Florida, is one of the nation’s leading transportation suppliers. The Company’s rail and inter- modal businesses provide rail-based transportation services including traditional rail service and the transport of intermodal containers and trailers.
CSX, Inc. | 2008 | 2007 |
Operating revenue | $11,255 | $10,030 |
Operating earnings | 2,768 | 2,260 |
Required
a. Determine which company appears to have the higher operating leverage.
b. Write a paragraph or two explaining why the company you identified in Requirement a might be expected to have the higher operating leverage.
c. If revenues for both companies declined, which company do you think would likely experience the greater decline in operating earnings? Explain your answer.
We need at least 10 more requests to produce the solution.
0 / 10 have requested this problem solution
The more requests, the faster the answer.