Question

If you buy an investment for $800 and then sell it for $1,000 ten months later, what is your annual return on investment (percentage)?

Answer 1

The annual return on investment (ROI) for buying an investment at $800 and selling it for $1,000 ten months later is 30%.

Step-by-step explanation:

To calculate the annual return on investment (ROI), we must first determine the overall return, then annualize it. You bought an investment for $800 and sold it for $1,000, resulting in a gain of $200. Since the investment was held for 10 months, we need to convert the return to an annual figure. The formula for the annual ROI is (Profit/Cost of Investment) x (12/Number of Months) x 100, which in this case is ($200/$800) x (12/10) x 100 = 30% annual ROI.

Answer 2

Answer: 25%

Step-by-step explanation:

The annual return on investment will be calculated as thus:

Invested amount = $800

Returned amount = $1000

Gain = Returned amount - Invested amount = $1000 - $800 = $200

Return on investment = Gain/Invested amount × 100

= 200/800 × 100

= ¼ × 100

= 25%

The return on investment is 25%