NOPAT Is Used for 'Income' in the Return on Investment

question 13

Multiple Choice

NOPAT is used for 'income' in the return on investment formula because

• A)investment center managers should not be evaluated based on long-term financing decisions since they do not have responsibility for making those decisions.
• B)NOPAT represents the return to stockholders, and divisions are free to issue stock.
• C)NOPAT represents the return to debt capital, and division managers generally are free to issue debt needed to acquire new investments.
• D)All of these answer choices are correct.

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Definitions:

Mylohyoid

A muscle that forms the floor of the mouth, elevates the tongue, and depresses the jaw.

Masseter

A facial muscle that plays a crucial role in chewing by elevating the mandible (lower jaw).

Fibularis Longus

A muscle of the lower leg that helps in plantarflexion and eversion of the foot.

Gastrocnemius

A major calf muscle that is involved in walking, running, and jumping, attaching to the heel through the Achilles tendon.