The Return on Invested Capital Generated by a Company Minus

question 82

Multiple Choice

The return on invested capital generated by a company minus the cost of the capital used in recreating the cash flow best describes

• A) economic value added.
• B) return on investment.
• C) break-even analysis.
• D) NPV analysis.

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Definitions:

Monopolistic Competitor

A firm that operates in a market structure characterized by many competitors selling differentiated products.

Perfect Competitor

A firm in a market structure where it takes the prevailing market price as given and decides its output level without being able to influence the market price.

Long Run

A period in economics during which all factors of production and costs are variable, and firms can enter or exit the industry.

Monopolistic Competitor

A market structure where many firms sell products that are similar but not identical, allowing for some degree of market power in setting prices.