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General Motors Income Statement: Year2016201720182019202020212022Total Revenue149,184145,588147,049137,237122,485127,004156,735Cost of Revenue, Total130,153127,357132,954123,265107,313105,726135,754Selling, General and Other expense10,3459,5709,6508,4918,53811,95410,667Operating Income8,6868,6614,4455,4816,6349,32410,314 Given information for General Motors: Cost of debt General Motors (from the footnotes to the financial statements) 2.80% Beta for General Motors (from Yahoo or other financial sources) 1.39 Normalized risk free rate of return in the market (observing the 10 rate on government issued securities)3.00% Equity risk premium (from historical studies of the market) 5.00% Market value of debt (use book or amount disclosed in the footnotes if different) $ 109,379 Number of common shares outstanding 1,460 Market price of the common stock (on July 13, 2021) $ 31.81 Market value of equity (number of shares times the stock price) Calculate the required return (weighted average cost of capital) Market WeightsComponent Weighted Values CostCost Debt Equity Required return (weighted average cost of capital)................................... Calculate the Economic Profit (Economic Value Added) Year2016201720182019202020212022Net Operating Assets$ 172,464 $ 168,070 $ 180,902 $ 183,766 $ 195,329 $ 206,491 $ 211,641 times the required return Required income in dollars Year2016201720182019202020212022Operating Income earned$ 8,686 $ 8,661 $ 4,445 $ 5,481 $ 6,634 $ 9,324 $ 10,314 Less required income Economic profit or (loss) Another way to look at this: Return on invested capital 5.04%5.15%2.46%2.98%3.40%4.52%4.87%Weighted average cost of capital Spread

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