Would you expect the following to be high or low in a labour-intensive industry: (1) operating leverage, (2) break-even point and (3) safety margin?

A) High, high, low
B) Low, low, high
C) Low, low, low
D) High, high, high

In a labor-intensive industry, operating leverage (which measures a firm's fixed costs relative to its variable costs) is typically low because the industry relies more on variable labor costs than on fixed capital costs. Consequently, the break-even point (the point at which total revenues equal total costs) is also lower, as less revenue is needed to cover lower fixed costs. The safety margin (the difference between actual or projected sales and the break-even sales) tends to be higher because the lower break-even point allows for a larger buffer before losses occur.