【正文】 本科畢業(yè)論文（設(shè)計） 外 文 翻 譯 原文 ： Economic Value Added A General Perspective Performance Measurement Investors measure overall performance of a firm as a whole to decide whether to invest in the firm or to continue with the firm or to exit from it. In order to achieve goal congruence, managers’ pensation is often linked with the performance of the responsibility centers and also with firmperformance. Therefore selection of the right measure is critical to the success of a firm. To measure performance of a firm we need a simple method for correctly measuring value created/ enhanced by it in a given time frame. All the current metrics trade off between the precision in measuring the value and its cost of measurement. In other words, each method takes into consideration the degree of plexities in quantifying the underlying measure. The more plex is the process, the more is the level of subjectivity and cost in measuring the performance of the firm. There is a continuous endeavor to develop a single measure that captures the overall performance, yet it is easy to calculate. Each metric of performance claims its superiority over others. Performance of a firm is usually measured with reference to its past record and the performance of other firms with parable risk profile. The various performance metrics currently in use are based on the returns on investment generated by the business entity . Therefore to reach a meaningful conclusion, returns generated by the firm in a particular year should be pared with returns generated by assets with similar risk profile (cross sectional analysis) Similarly return on investment for the current period should be pared with returns generated in past (time series analysis). A firm creates value only if it is able to generate return higher than its cost of capital. Cost of capital is the weighted average cost of equity and debt (WACC). The performance of a firm gets reflected on its valuation by the capital market. Market valuation reflects investor’s perception about the current performance of the firm and also their expectation on its future performance. They build their expectations on the estimated growth of the business in terms of return on capital. This results in an incongruence between current performance and the value of the firm. Even if the current performance is better in relative terms, poor growth prospects adversely affects the value of the firm. Therefore any metric of performance, to be effective, should be able to not only capture the current performance but also should be able to incorporate the direction and magnitude of future growth. Therefore the robustness of a measure is borne out by the degree of correlation the particular metric has with respect to the market valuation. Perfect correlation is impossible because as shown by empirical research fundamentals of a pany cannot fully explain its market capitalization, other factors such as speculative activities, market sentiments and macroeconomic factors influence movement in share prices. However the superiority of a performance metric over others lies in providing better information to investors. Metrics of performance have a very important and critical role not only in evaluating the current performance of a firm but also in achieving high performance and growth in the future. The metrics of performance have a variety of users, which include all the stakeholders whose well being depends on the continued well being of the firm. Principal stakeholders are the equity holders, debt holders, management, and suppliers of material and services, employees and the endusers of the products and services. Value creation and maximization depends on the alignment of the various conflicting interests of these stakeholders towards a mon goal. This means maximization of the firm value without jeopardizing the interests of any of the stakeholders. Any metric, which measures the firm value without being biased toward