Return on investment is a better test of profitability than just the amount of income generated by the investment.

Question

Quizplus · Accepted Answer

Return on investment (ROI) considers both the amount of income generated by the investment and the amount of resources used to generate that income, ultimately providing better insight into the profitability of the investment. It takes into account factors such as the initial investment, any ongoing expenses, and the time frame in which the income is generated. Simply looking at the amount of income generated may not accurately reflect the overall profitability of the investment.

Return on Investment Is a Better Test of Profitability Than