PRIN.OF CORPORATE FINANCE
PRIN.OF CORPORATE FINANCE
13th Edition
ISBN: 9781260013900
Author: BREALEY
Publisher: RENT MCG
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Chapter 12, Problem 21PS

EVA Use the Beyond the Page feature to access the Excel program for calculating the profitability of the Nodhead project. Now suppose that the cash flows from Nodhead’s new supermarket are as follows:

Chapter 12, Problem 21PS, EVA Use the Beyond the Page feature to access the Excel program for calculating the profitability of

  1. a. Recalculate economic depreciation. Is it accelerated or decelerated?
  2. b. Rework Tables 12.2 and 12.3 to show the relationship between (a) the “true” rate of return and book ROI and (b) true EVA and forecasted EVA in each year of the project’s life.
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