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Springfield Corporation, whose tax rate is 40%, has two sources of funds: longterm debt with a market value of $8,000,000 and an interest rate of
Springfield Corporation, whose tax rate is 40%, has two sources of funds: longterm debt with a market value of $8,000,000 and an interest rate of 8%, and equity capital with a market value of $12,000,000 and a cost of equity of 12%. Springfield has two operating divisions, the Blue division and the Gold division, with the following financial measures for the current year: Current Operating Total Assets Liabilities Incom e BlueDiv. $9,500,000 $2,000,000 $1,055,000 GoldDiv. $11,000,000 $2,200,000 $1,200,000 What is Economic Value Added (EVAiE) for the Gold Division
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