Return on Investment (ROI)
Content
Definition
Return on Investment (ROI) measures the gain or loss generated on an investment relative to the amount of money invested, indicating the efficiency of the investment.
Usage and Context
Return on investment (ROI) evaluates the effectiveness of an investment by comparing the returns to the amount invested.
Frequently asked questions
- What does the return on investment measure? Return on Investment (ROI) calculates the efficiency of an investment by comparing the net profit to the initial cost.
- What is ROI determined by? ROI (Return on Investment) is calculated by dividing net profit by the initial investment cost and converting it into a percentage.
- What is return on investment ROI quizlet? ROI measures how efficiently an investment generates profit, calculated as (Net Profit / Cost of Investment) x 100.
Benefits
Return on investment (ROI) indicates the efficiency of an investment by comparing gains to the invested amount.
Conclusion
Return on investment (ROI) checks how efficient an investment is by comparing the gains to the costs.
