Which of the Following Statements Is CORRECT

question 121

Multiple Choice

Which of the following statements is CORRECT?

• A)MVA stands for market value added, and it is defined as follows:MVA = (Shares outstanding)(Stock price) + Book value of common equity.
• B)The primary difference between EVA and accounting net income is that when net income is calculated, a deduction is made to account for the cost of common equity, whereas EVA represents net income before deducting the cost of the equity capital the firm uses.
• C)MVA gives us an idea about how much value a firm's management has added during the last year.
• D)EVA gives us an idea about how much value a firm's management has added over the firm's life.
• E)EVA stands for economic value added, and it is defined as follows:EVA = NOPAT − (Total invested capital)(AT cost of capital %)

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Definitions:

Mutual Understanding

A state of agreement or empathy between two or more parties, where each party comprehends the others' perspectives or intentions.

Compromise

A method of conflict resolution where two or more parties each concede some of their demands to reach a mutually acceptable agreement.

Critical Reflection

The process of analyzing and evaluating one's thoughts, actions, and experiences to gain deeper understanding and improve future outcomes.

Character Strengths

Positive traits or qualities that are considered inherent in individuals and contribute to their overall well-being and ability to achieve personal goals.