Using EVA to evaluate the financial performance of a movie is not a good idea because ____________.
A) a movie is a short lived project.
B) the cost of capital cannot be determined.
C) the assets employed are too low.
D) net income in future years cannot be forecasted.

Question

Quizplus · Accepted Answer

EVA (Economic Value Added) is more suitable for ongoing businesses rather than short-lived projects like movies, which have a limited time frame for generating returns.

Using EVA to Evaluate the Financial Performance of a Movie