The Division Director for Natchez Corporation's Mississippi Division,which Operates as an Investment
Multiple Choice
The division director for Natchez Corporation's Mississippi division,which operates as an investment center,is considering investing in machinery which costs of $2,200,000 and is expected to generate $332,000 in additional operating income.If the division's weighted average cost of capital is 11% and its tax rate is 20%,what is the equipment's EVA?
A) $23,600
B) $90,000
C) $242,000
D) $332,000
Correct Answer:
Verified
Correct Answer:
Verified
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