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Author Question: The Social Security system provides for reduced benefits at an early retirement age. Indicate ... (Read 142 times)

Zoey63294

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The Social Security system provides for reduced benefits at an early retirement age.
 
  Indicate whether the statement is true or false

Question 2

In 2012 Advantage Cable Inc. had 250,000 in invested capital, a WACC of 9.35, EBIT of 75,000, and a tax rate of 30. With this information please estimate the economic value added (EVA) for the firm.
 
  A) 29,125
  B) 23,375
  C) 52,500
  D) There is not enough information to answer this question.



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pikon

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Answer to Question 1

TRUE

Answer to Question 2

A
Explanation: A) EVA = EBIT  (1- tax rate) - capital charges . EVA = 75,000  (1-.3 ) - 250,000  .0935 = 29,125.




pikon

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