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A3. A company has $25mln worth of capital, and a cost of capital of 15%. Its profit after taxes for the current year was $4mln.

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A3. A company has $25mln worth of capital, and a cost of capital of 15%. Its profit after taxes for the current year was $4mln. In order to calculate the Economic Value Add, the company has adjusted its profit to $5mln and its capital to $26mln. What is the EVA? a. 100,000(4m0.1526m) b. 1.1m(5m0.1526m) c. 1.25m(5m0.1525m) d. 5m

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