Practicing Success

Target Exam

CUET

Subject

Entrepreneurship

Chapter

Business Arithmetic

Question:
A person spends Rs 100,000/- to open a grocery shop and make a net profit of Rs 20,000/- in one year. The annual Return on Investment (ROI) will be:
Options:
20%
25%
30%
None of the above
Correct Answer:
20%
Explanation:
Return on investment equals the net income from a business or a project divided by the total money invested in the venture multiplied by 100.
ROI = Net Profit x 100/Total Capital Invested
ROI= (20,000/100,000) x 100 = 20 percent.