The concept of 'Economic Value Added' (EVA) is defined as:
A. Net operating profit after tax minus the opportunity cost of capital employed
B. Only cash flow
C. Only accounting profit
D. Only revenue minus explicit costs
Answer: Option A
Solution (By JKSSB Mock Tests)
Economic Value Added is a measure of residual income calculated as net operating profit after tax minus a charge for the opportunity cost of the capital employed in the business.
In the context of public debt management, 'Debt Sustainability Analysis' typically examines:
A.Whether the projected path of the debt-to-GDP ratio remains stable or declines under plausible assumptions about growth, interest rates and primary balances
Explanation:
Debt sustainability analysis assesses whether a country’s debt trajectory is consistent with intertemporal solvency, usually by examining the evolution of the debt-to-GDP ratio under baseline and stress scenarios.
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