A ratio of profit to capital used or a rate of return from capital is referred to as
A)the debt-equity ratio.
B)the profitability ratio.
C)return on investment (ROI).
D)the liquidity ratio.
E)the leverage ratio.

Question

Quizplus · Accepted Answer

Return on Investment (ROI) is the ratio of profit (or income) to capital used (or investment) and is used to evaluate the efficiency of an investment or project. It is a commonly used profitability ratio and is calculated by dividing the net profit by the total invested capital.

A Ratio of Profit to Capital Used or a Rate