If the National Division of American Products Company had a investment turnover ratio of 4.2 and a profit margin percentage 10%,the return on investment would be
A)23.8%
B)420.0%
C)42.0%
D)238.0%

Question

Quizplus · Accepted Answer

The formula for return on investment (ROI) is:

ROI = Profit margin x Investment turnover ratio

Substituting the given values, we get:

ROI = 0.1 x 4.2 = 0.42 or 42%

Therefore, the best choice is C, which is 42.0%.

If the National Division of American Products Company Had a Investment