The Formula to Calculate EVA Is

question 161

Multiple Choice

The formula to calculate EVA is

• A)Net operating profit - invested capital x weighted average cost of capital.
• B)Contribution margin - invested capital x weighted average cost of capital.
• C)Net operating profit - average capital assets x internal rate of return.
• D)Contribution margin - average capital assets x internal rate of return.

---

Definitions:

Macro Uncertainty

The uncertainty that exists within the broad economy which can impact decision-making and future outcomes on a large scale.

Break-even Analysis

Break-even analysis is a financial calculation used to determine the point at which revenue equals costs, indicating no net loss or gain, and is used for decision making in business planning.

Employee Wages

Employee wages refer to the fixed regular compensation paid by employers to employees for their labor or services, typically expressed as an hourly, daily, or monthly rate.

Environmental Uncertainty

A condition where there is a lack of information about the environmental factors that can affect an organization's operations.