Which of the Following Does Not Accurately Describe Economic Value

question 15

Multiple Choice

Which of the following does not accurately describe economic value added.

• A) It is after-tax operating profit minus the total annual cost of capital.
• B) It includes the cost of debt and the cost of equity.
• C) It is a measure of the value added or depleted from shareholder value in one period.
• D) It requires that different costs of capital be used in different country settings.

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Definitions:

Persuasion

The process of influencing someone's beliefs, attitudes, intentions, motivations, or behaviors through communication and various techniques.

Motivated

Having a strong desire or willingness to act and achieve specific goals.

Commercial

Relating to or engaged in commerce; intended for or pertaining to the selling and buying of goods and services.

Source Credibility

The perceived trustworthiness, expertise, and reliability of the source of information.