Explain why each of the following statements is generally incorrect:

a. “The firm with the highest market value is the one that has created the most value for its shareholders.”

b. “If a firm’s market value added (MVA) is positive, then its current return on invested capital (ROIC) must exceed its weighted average cost of capital (WACC).”

c. “Growth is the key to increasing a firm’s MVA.”

d. “This year’s economic value added (EVA) is positive, so the firm’s market value added must also be positive.”

e. “Giving managers a bonus related to their ability to increase the profitability (ROIC) of their business unit is one way to enhance shareholder value.”