Which of the following financial performance measures can be used to compare potential projects of different sizes?
A)EVA
B)Residual income
C)ROI
D)Operating income

Question

Quizplus · Accepted Answer

ROI (Return on Investment) is a financial performance measure that compares the amount of return on an investment to its cost. It allows for a uniform comparison of potential projects of different sizes as it is calculated by dividing the net profit by the total investment. Therefore, it considers both the size and profitability of a project, making it the best option among the given choices for comparing potential projects of different sizes.

Which of the Following Financial Performance Measures Can Be Used