EVA assumes a business is worth the present value of anticipated net cash flows discounted by the cost of capital,less the amount invested in order to generate future cash flows.

Question

Quizplus · Accepted Answer

This is the definition of Economic Value Added (EVA). It is a measure of financial performance that calculates the difference between the expected return on invested capital and the cost of that capital.

EVA Assumes a Business Is Worth the Present Value of Anticipated