12- American Transmitter (AT) is a telecommunications firm that currently does not pay a dividend. The following information about AT has been gathered from various sources:

Average cost of funds 8.0 %

EBIT $ 600,000

Total capital $2,000,000

EPS $2.64

Shares outstanding 100,000

Marginal tax rate 40.0%

Compute the economic value added (EVA) for AT in the current operating period. Is AT a good investment?

a.

$200,000

b.

$210,000

c.

$220,000

d.

$230,000