The simple rate of return on the investment would be:
A) 10%.
B) 15%.
C) 25%.
D) 35%.

Question

Quizplus · Accepted Answer

The simple rate of return can be calculated by dividing the profit (or income) by the initial investment, and expressing the result as a percentage. In this case, the profit is $1,500 and the initial investment is $10,000, so:

simple rate of return = 1500/10000 = 0.15

To express this as a percentage, we multiply by 100:

simple rate of return = 0.15 x 100% = 15%

Therefore, the correct answer is B, with a simple rate of return of 15%.

The Simple Rate of Return on the Investment Would Be