Question

The original cost of Sam’s investment is $10,000. After liquidating the investment, Sam calculated his real return to be $10,700. What is the return on investment (ROI)?

Answer 1

7%

Explanation:

Step one:

given data

The original cost of Sam’s investment is $10,000

Sam calculated his real return to be $10,700

Required:

the interest made from the investment is

10700-10000= $700

Step two:

The ROI is a percentage that tells us the interest made

interest/investment*100

=700/10000*100

=0.07*100

= 7%

The ROI is 7%