Question

What is the formula for Return on Investment (RoI)?

Options

• \[\frac{\text{Total Investment}}{\mathrm{EBIT}}\times100\]

• \[\frac{\mathrm{Debt}}{\mathrm{Equity}}\]

• \[\frac{\mathrm{Debt}}{\mathrm{Debt}+\mathrm{Equity}}\]

• \[\frac{\mathrm{EBIT}}{\text{Total Investment}}\times100\]

Answer 1

Return on Investment is \[\frac{\mathrm{EBIT}}{\text{Total Investment}}\times100\]. It compares EBIT with the total investment and expresses the result as a percentage.