An introduction to the theory and practice of Economic Profit based investment analysis, along with discussion of how this method fits within the broader Value Based Strategy and Management Framework. A simplified example is provided of how to compute the Net Present Value of Economic Profit for an investment opportunity, including an illustration of its equivalence with the Net Present Value of Free Cash Flow model. For a more detailed review, please contact Arche Value Management at the enclosed address.
Introduction to Economic Profit Based Investment Analysis, Arche Value Management, January 2014