What is ROI?, How to calculate margin?

Question

Accepted Answer

ROI is Return on Investment. Margin is the difference between revenue and cost.

ROI is a measure of profitability that calculates the return on an investment relative to its cost.
ROI = (Gain from Investment - Cost of Investment) / Cost of Investment
Margin is the difference between revenue and cost, expressed as a percentage.
Margin = (Revenue - Cost) / Revenue * 100%
For example, if a company spends $100 on advertising and generates $150 in sales, the ROI is 50% and the margin is 33.3%.

Accepted Answer

To determine the gross profit margin, we need to divide the gross profit by the total revenue for the year and then multiply by 100. To determine the net profit margin, we need to divide the net income (or net profit) by the total revenue for the year and then multiply by 100

What is ROI?, How to calculate margin?

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