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23 December, 09:02

The profit margin for central division is 20% and the investment turnover is 2.8. what is the rate of return on investment for central division?

a. 14%

b. 56%

c. 20%

d. 7.1%

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Answers (1)
  1. 23 December, 09:31
    0
    The rate of return would simply be the product of the profit margin and the investment turnover. Therefore,

    Rate of return = Profit margin x Investment turnover

    Rate of return = 20% x 2.8

    Rate of return = 56%

    Answer: B. 56%
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