7. A firm has total assets of $5,000,000 and has raised money from both debt and equity. Assume that the firms cost of capital is 12%. Assume that the firm earns 17% operating return on its assets (OROA) and its operating profit margin (OPM) is 20%. What is the amount of Economic Value Added for this firm?

A. $250,000

B. $400,000

C. 150,000

D. 300,000

A is the correct answer but please show how you arrive at that answer