ROI - PRICING QUIZ

What is the formula for return on investment?

• ROI = (profit/cost of investment) + 100

• ROI = (profit/cost of investment) x 100

• ROI = (profit/cost of investment) / 100

• ROI = (profit/cost of investment) + 100

Bill sells jeans online that he bought for $35 a pair. One pair of jeans sells for $65. What is his return on investment (ROI) per pair at this price? (one decimal place xx.x% )

A pet groomer charges $45 to groom a dog. The total cost of her business from home is $1,000 per month. She pays herself $3,500 per month. She must groom at least 100 dogs to cover expenses and salary. She believes that she should be paid more and wants her salary to be $4,000 per month, making her total expenses $5,000. What is the minimum price she must charge for each grooming if she is still grooming only 100 dogs per month?

You buy a car for $26,450. Because you now have reliable transportation, you are able to obtain a job and earn $10,860 in your first year. Calculate your return on investment for that year. (one decimal place xx.x% )

Answer explanation

This one is a little harder to understand. Think in terms of real money and not just math:

price: $26,450

salary: $10,860

Great, you are being responsible, but you are in the negative still!

You purchased the maximum allowed amount of US Treasury I-Bonds, which is $10,000 per calendar year. The rate of return was 9% but there was a $35 fee charged for taking it out at the 13 month. What was your return on investment (ROI)? (two decimal places with %: x.xx%)

A business purchases a new form of information system technology for $500,000. Because of this purchase, the company begins earning $50,000 a year. Find the ROI for the first year.