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What Are Some Items That Can Affect an Investment Center's

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What are some items that can affect an investment center's EVA calculation,and how can EVA be improved?


Definitions:

Discounted Payback

The period of time required for the return on an investment to cover the cost of the investment, accounting for the time value of money.

Rate of Return

The increase or decrease in value of an investment during a specific duration, represented as a percentage of the investment's starting cost.

Cash Inflow

The total amount of money being transferred into a company, typically from operations, investments, and financing activities.

Discount Rate

Discount Rate is the interest rate used in discounted cash flow (DCF) analysis to determine the present value of future cash flows.

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