Return on investment (ROI) is a measure of:a.Profitabilityb.Efficiencyc.Liquidity
Question
Return on investment (ROI) is a measure of:a.Profitabilityb.Efficiencyc.Liquidity
Solution
ROI, or Return on Investment, is a measure of profitability. It helps determine the financial success of an investment by comparing the gain or loss generated relative to the amount invested. ROI is calculated by dividing the net profit from the investment by the initial investment amount and expressing it as a percentage. A higher ROI indicates a more profitable investment, while a lower ROI suggests a less profitable one. Therefore, the correct answer is option a. Profitability.
Similar Questions
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