QUESTION IMAGE
Question
vocabulary term definition formula
profit margin shows the of revenue that becomes profit, highlighting the businesss efficiency.
slide 26
$0.83 net profit per unit ÷ $5 selling price per unit =
vocabulary term definition formula
return on investment measures how efficiency an investment generates profit to its cost.
slide 27
($30,000 net profit - $7,500 investment cost ) / $7,500 investment cost = x 100 = roi
a good roi, generally 10% to 15% return on investment. an excellent roi, typically start around 20% or higher.
pricing strategy (slide 28)
pricing strategy is how a business sets to cover costs and make a profit.
Step1: Calculate Profit Margin
$$\frac{0.83}{5}\times100 = 16.6\%$$
Step2: Calculate Return on Investment (ROI)
First, calculate the numerator: $30000 - 7500=22500$
Then, calculate the fraction: $\frac{22500}{7500}=3$
Multiply by 100: $3\times100 = 300\%$
For the blank in the definition of Return on Investment: “relative” (since ROI measures profit relative to cost)
For the blank in Pricing strategy: “prices”
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Profit Margin: $16.6\%$; Return on Investment: $300\%$; ROI definition blank: “relative”; Pricing strategy blank: “prices”