Answer: ROI (Return on Investment) is a financial metric used to assess the profitability and efficiency of an investment. Two quantifiable business metrics that could be used to measure ROI are:
Net Profit: Net profit is the amount left after deducting all expenses from the total revenue generated. It represents the profitability of the investment. By comparing the net profit with the investment cost, you can calculate the ROI. The formula for ROI is: ROI = (Net Profit / Investment Cost) * 100.
Revenue Growth: Revenue growth measures the increase in sales or revenue over a specific period. It indicates the effectiveness of the investment in generating additional income. Higher revenue growth signifies a better return on investment. The formula for calculating revenue growth is: Revenue Growth = ((Current Revenue - Previous Revenue) / Previous Revenue) * 100.
Both net profit and revenue growth provide quantifiable measurements of the financial performance and effectiveness of an investment. By analyzing these metrics, businesses can evaluate the success and profitability of their investments and make informed decisions for future investments.
Step-by-step explanation: