When calculating Economic Value Added (EVA), the weighted average cost of capital replaces the target Return on Investment (ROI) as the expected rate of return.

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EVA is a measure of a company's financial performance that is calculated by subtracting its cost of capital from its operating profit. The weighted average cost of capital (WACC) is used as the discount rate in EVA calculations, as it represents the minimum return that an investor would expect to receive from a company's investments. Thus, the statement is true as the WACC replaces the ROI in EVA calculations.

When Calculating Economic Value Added (EVA), the Weighted Average Cost