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Mama's Pies, a baking company, adds another store to sell its pastries. The new store costs $400,000 to build and it will generate revenues of $450,000. The rate of return on this investment is _____%.

Respuesta :

jepessoa

Answer:

12.5%

Explanation:

the rate of return (RoR) on this investment = (additional revenues / investment) - 1 = ($450,000 / $400,000) - 1 = 1.125 - 1 = 0.125 or 12.5%

The rate of return (RoR) measures the profits or losses generated by a project compared to the total cost of the project.

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