EVA is a financial management technique that enables banks to select loans that maximize shareholder wealth.

Question

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EVA (Economic Value Added) is a measure of a company's financial performance based on the residual wealth calculated by deducting its cost of capital from its operating profit, adjusted for taxes on a cash basis. It can be used by banks to select loans that maximize shareholder wealth by focusing on those opportunities that are expected to generate a return above their cost of capital, thereby enhancing value for shareholders.

EVA Is a Financial Management Technique That Enables Banks to Select