Return on Investment (ROI) Formula: ROI = [(Investment Gain – Cost of Investment) / Cost of Investment] X 100 You buy a parcel of land for $100,000. After spending $200,000 to build a home on said land, you put it on the market. Several months after listing the property, you sell it for $350,000.

Return on Investment (ROI) Formula: ROI = [(Investment Gain – Cost of Investment) / Cost of Investment] X 100 You buy a parcel of land for $100,000. After spending $200,000 to build a home on said land, you put it on the market. Several months after listing the property, you sell it for $350,000.

Essentials Of Investments

11th Edition

ISBN:9781260013924

Author:Bodie, Zvi, Kane, Alex, MARCUS, Alan J.

Publisher:Bodie, Zvi, Kane, Alex, MARCUS, Alan J.

Chapter1: Investments: Background And Issues

Section: Chapter Questions

Problem 1PS

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Return on Investment (ROI)

Formula: ROI = [(Investment Gain – Cost of Investment) / Cost of Investment] X 100

You buy a parcel of land for $100,000. After spending $200,000 to build a home on said land, you put it on the market. Several months after listing the property, you sell it for $350,000.

Formula Formula ROI (%) = Net Income Principal Amount × 100

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