The Return on Investment (ROI) Ratio Measures

question 4

Multiple Choice

The return on investment (ROI) ratio measures:

• A) The rate of return on average shareholders' equity.
• B) Only earnings as a percent of sales.
• C) The combined effect of both asset turnover and return on sales (ROS).
• D) Asset turnover and earnings as a percent of sales, correcting for the effects of differing depreciation methods.
• E) Operating income less a charge for divisional investment (assets).

---

Definitions:

Numerical Index

A numerical representation or measurement, often used for comparing statistical data, assessing performance, or tracking changes over time.

Normally Distributed

Describes a statistical distribution where data points are symmetrically distributed around the mean, forming a bell-shaped curve.

Percentage

A portion of a whole expressed as a fraction of 100, used in quantifying proportions and ratios.

Descriptive Statistics

Statistical methods that summarize and organize data collected from a sample or population, including measures such as mean, median, and standard deviation.