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The cost of capital of the XYZ Company is 10%. The corporate tax rate is 30%. The cost of equity capital is 15%. The total
The cost of capital of the XYZ Company is 10%. The corporate tax rate is 30%. The cost of equity capital is 15%. The total invested capital is $800.000.
Net Sales $700.000: Cost of Goods Sold (COGS) represents 60% of sales: SG&A Expenses $70,000: Depreciation $50,000: Other Operating Expenses $10,000: Financial charges $50.000.
1-What is the NOPAT for the XYZ Company?(2 points)
2- Calculate the company's Economic value added (EVA). Interpret (2 points)
3- If the future EVAS are expected to remain constant for five years, calcutate the market value added (MVA). Interpret. (2 points)
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