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Measuring the Success of a Divisional Investment Center Is Closely

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Essay

Measuring the success of a divisional Investment Center is closely tied to understanding whether or not the division meets profit expectations.To understand profits,two alternatives are proposed for tracking profitability: ROA and EVA.From the point of view of an economist,why is EVA usually preferred?


Definitions:

Hostility

Aggressive behavior or attitudes towards others, often stemming from anger or resentment.

Defense Mechanism

Unconscious tactics employed to shield oneself from the stress stemming from thoughts or feelings that are deemed unacceptable.

Anna Freud

A pioneer in child psychoanalysis and the youngest daughter of Sigmund Freud who emphasized the importance of the ego and its defense mechanisms in psychology.

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