Question

On Jan. 1, Jimena invested $500 in stocks for Dasha DogCare Company. She sold her shares on Feb. 1 for $560.What was Jimena's return on investment?Round to the nearest tenth of a percent, if necessary.

Answer 1

Return on investment formula:

`\begin{gathered} \text{ROI}=\frac{\text{Net investment gain}}{Cost\text{ of investment}}*100 \\ \\ Net\text{ investment=Market price -Cost of the investment } \end{gathered}`

For the given situation:

`\begin{gathered} \text{ROI}=(560-500)/(500)*100 \\ \\ \text{ROI}=(60)/(500)*100 \\ \\ \text{ROI}=12 \end{gathered}`

Then, the Return on investment is 12%