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What was the firm economic value added

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Reference no: EM131508948

Bargain Basement Stores reported $11,500 of sales and $5,000 of operating costs (including depreciation). The company has $20,500 of investor-supplied capital, the weighted average cost of that capital (the WACC) was 10%, and the federal-plus-state income tax rate was 40%. What was the firm's Economic Value Added (EVA), i.e., how much value did management add to stockholders' wealth during the year?

a. $1,670
b. $1,758
c. $1,850
d. $1,943
e. $2,040

Reference no: EM131508948

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