A marketing campaign costs $2,000 and generates $8,000 in sales. What is the ret

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Question: A marketing campaign costs $2,000 and generates $8,000 in sales. What is the return on investment (ROI)?

Options:

Correct Answer: 400%

Solution:

ROI = (Net Profit / Cost of Investment) x 100 = (($8,000 - $2,000) / $2,000) x 100 = 300%.

A marketing campaign costs $2,000 and generates $8,000 in sales. What is the return on investment (ROI)?

A marketing campaign costs $2,000 and generates $8,000 in sales. What is the return on investment (ROI)?

Step 1: Identify the cost of the marketing campaign. In this case, it is $2,000.
Step 2: Identify the total sales generated from the campaign. Here, it is $8,000.
Step 3: Calculate the net profit by subtracting the cost of the campaign from the total sales. So, $8,000 - $2,000 = $6,000.
Step 4: Use the ROI formula: ROI = (Net Profit / Cost of Investment) x 100.
Step 5: Plug in the numbers: ROI = ($6,000 / $2,000) x 100.
Step 6: Calculate the division: $6,000 / $2,000 = 3.
Step 7: Multiply by 100 to get the percentage: 3 x 100 = 300%.
Step 8: The final answer is that the ROI is 300%.

Return on Investment (ROI) – ROI is a financial metric used to evaluate the profitability of an investment, calculated as the net profit divided by the cost of the investment, expressed as a percentage.