Return on Investment (ROI) Concepts

This video tutorial explains how to calculate the return on investment (ROI) using various examples. It covers the basic formula for ROI, demonstrates calculations for a home sale, stock investment, and rental property income. The video also discusses how to estimate annual ROI and compares different investment scenarios to highlight the impact of investment choices on ROI.

What is the formula for calculating the return on investment (ROI)?

• Cost of investment minus profit

• Profit divided by cost of investment

• Cost of investment divided by profit

• Profit multiplied by cost of investment

How much profit did John make from selling his house?

• $50,000

• $125,000

• $75,000

• $100,000

What was John's annual ROI if his total ROI over five years was 30%?

• 8%

• 7%

• 6%

• 5%

How much did Karen invest in total for her 500 shares?

• $15,000

• $10,000

• $5,000

• $20,000

What was Karen's ROI over the three-month period?

• 40%

• 25%

• 30%

• 35%

If Karen's stock continues to grow at the same rate, what would be her annual ROI?

• 120%

• 130%

• 140%

• 150%

What is Luke's annual ROI from his rental property investment?

• 18%

• 12%

• 10%

• 15%

How much annual profit does James make from his four condos?

• $60,000

• $48,000

• $36,000

• $24,000

What is Susan's total ROI from rental income over 10 years?

• 150%

• 125%

• 100%

• 175%

What is Susan's total ROI from both rental income and property sale?

• 275%

• 200%

• 225%

• 250%