Which of the following changes would increase return on investment (ROI)?
A)Decrease sales and expenses by the same percentage.
B)Increase total assets.
C)Increase sales and expenses by the same percentage.
D)Decrease sales and expenses by the same dollar amount.

Question

Quizplus · Accepted Answer

Increasing sales and expenses by the same percentage can increase ROI if the sales increase leads to a higher incremental profit margin than the percentage increase in expenses. This leverages the fixed cost structure to improve overall profitability, thus enhancing ROI.

Which of the Following Changes Would Increase Return on Investment