Question

The dollar value of a firm's return in excess of its opportunity costs is called its
excess return.
prospective capacity
economic value added.
profitability measure!
return margin.​

Answer 1

Answer:

Economic value added measures the success of the firm relative to its return on projects vs. the rate investors could earn themselves in the capital markets. EVA = ROA - k*Capital invested.

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Answer 2

Answer:

Economic value added is the correct answer.

Explanation:

Every entrepreneur starting a business sees it in two ways. The first is accounting profit, which is total revenue less explicit costs, and the second is economic profit, which is total revenue less both explicit and implied costs. income is deducted. Economic profit is an opportunity cost. For example, let's say you founded a publishing company with an accounting profit of $100,000. With the same costs and resources, if you could get an accounting profit of $20,000 if you started a dairy business, you would end up with $20,000 or $80,000 in economic loss, or $80,000 more or added economic value. Or made an additional $80,000 in financial profits. Therefore, if the firm earns more than the opportunity cost, the additional amount of money created or added represented by the economic value of the option is called the economic value.

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