The ________ rate of return on investment leads to the mark-up percentage and the prospective selling price.

Question

Quizplus · Accepted Answer

The target rate of return on investment is the desired profit margin that a business wants to achieve from an investment. It is used to calculate the mark-up percentage, which is the amount added to the cost of a product to determine its selling price. Therefore, the target rate of return on investment is directly linked to the mark-up percentage and the prospective selling price. Internal and expected rates of return are usually used for evaluating the profitability of a specific investment, while external rates of return are used to compare the performance of different investments.

The ________ Rate of Return on Investment Leads to the Mark-Up