The Tandem Division of the Great Adventures Cycles Company Had

question 2

Multiple Choice

The Tandem division of the Great Adventures Cycles Company had the following results last year (in thousands) . $$\begin{array} { | l | r r | } \hline \text { Sales } & \$ & 4,000,000 \\\hline \text { Operating incare } & \$ & 480,000 \\\hline \text { Total assets } & \$ & 2,000,000 \\\hline \text { Current liabilities } & \$ & 300,000 \\\hline\end{array}$$ Management's target rate of return is 10% and the weighted average cost of capital is 8%.Its effective tax rate is 40%.
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What is the Tandem division's Economic Value Added (EVA) ?

• A)$136,000
• B)$152,000
• C)$280,000
• D)$288,000

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Definitions:

UCS Preexposure Effect

The effect caused by exposure to the unconditioned stimulus (UCS) prior to conditioning; it impairs later conditioning when a conditioned stimulus (CS) is paired with that UCS.

New Food

Refers to any food product that has been recently developed, introduced, or becomes available for consumption, often involving innovative ingredients or preparation methods.

Flu

An infectious viral illness causing fever, muscle pain, sore throat, and cough, often leading to severe fatigue.

Backward Conditioning

A paradigm in which the unconditioned stimulus (UCS) is presented and terminated prior to the conditioned stimulus (CS).