Economic Value Added (EVA) Is

question 16

Multiple Choice

Economic value added (EVA) is

• A) the difference between the return on assets and the opportunity cost of capital times the capital base.
• B) ROA × ROE.
• C) a measure of the firm's abnormal return.
• D) largest for high-growth firms.

---

Definitions:

Tax Shown

The amount of tax displayed on a taxpayer's return or assessed as due by the IRS.

25%

A percentage often referred to in financial contexts, such as a tax bracket, rate of return on investment, or portion of an entity.

Social Security

A government system that provides financial assistance to people with an inadequate or no income, particularly in retirement, disability, or survivorship.

Wage Limitation

A cap on the amount of wages that can be considered for certain tax calculations or benefits, such as Social Security taxes.