ASHER: During the $1990$s$,$ the consulting firm Stern, Stewart & Company developed the concept of Market Value Added, or MVA, to better assess management$$s performance in maximizing their shareholders$$ wealth. To achieve this, a firm$$s MVA is computed as the between $($of$)$ the value and the value of Western G&E$$s shareholders$$ equity.

OK$,$ now here$$s a question for you: Compared to the book value, what is the advantage of the MVA as a means of evaluating management$$s performance?

TESSA: Well, I would say that because the market value of Western G&E$$s shareholders$$ equity is calculated by multiplying the shares$$ by the number of shares $,$ then it will fluctuate depending on how the market perceives management$$s performance. A positive assessment will result in market price and MVA.

ASHER: Nicely done! Does this make your reading of Western G&E$$s annual report easier?