Question: 7. (Adapted from 2000 CFA Level II exam) Jim Martin is using economic value added (EVA) and market value added (MVA) to measure the performance

7. (Adapted from 2000 CFA Level II exam) Jim Martin is using economic value added

(EVA) and market value added (MVA) to measure the performance of Sundanci. Martin uses the fiscal 2000 information below for his analysis.

• Adjusted net operating profit after tax (NOPAT) is $100 million.

• Total capital is $700 million (no debt).

• Closing stock price is $26.

• Sundanci has 84 million shares outstanding.

• The cost of equity is 14 percent.

Calculate the following for Sundanci. Show your work.

A. EVA for fiscal 2000 B. MVA as of fiscal year-end 2000

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