[amp_mcq option1=”Net profit and capital employed” option2=”Investment and profit” option3=”Sales and capital invested” option4=”Net profit and dividend” correct=”option1″]
The correct answer is A. Net profit and capital employed.
Return on investment (ROI) is a performance measure used to evaluate the efficiency or profitability of an investment or compare the efficiency of a number of different investments. ROI tries to directly measure the amount of return on a particular investment, relative to the investment’s cost. To calculate ROI, the benefit (or return) of an investment is divided by the cost of the investment. The result is expressed as a percentage or a ratio.
Net profit is the total revenue of a company minus all of its expenses. Capital employed is the total amount of money that a company has invested in its assets.
ROI is a useful tool for comparing the profitability of different investments. It can also be used to track the performance of an investment over time. A high ROI indicates that an investment is profitable, while a low ROI indicates that an investment is not profitable.
Here are the brief explanations of each option:
- Option A: Net profit and capital employed. This is the correct answer. ROI is calculated by dividing net profit by capital employed.
- Option B: Investment and profit. This is not the correct answer. ROI is not calculated by dividing investment by profit.
- Option C: Sales and capital invested. This is not the correct answer. ROI is not calculated by dividing sales by capital invested.
- Option D: Net profit and dividend. This is not the correct answer. ROI is not calculated by dividing net profit by dividend.