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Question(s) / Instruction(s):

Gallop Company has total assets of $600,000, a 10% target rate of return, a return on investment of 12%, an 8% weighted average cost of capital, and current liabilities of $100,000. What is Gallop Company’s economic value-added, assuming that the income tax rate is 40%? 

A             $3,200

B             $32,000

C             -$4,800

D             -$6,800

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