Answer:
The answer is 18%
Explanation:
Return on investment is defines as the revenue or profit that is earned by a business as a result of certain amount invested in a business or activity.
It is calculated by dividing profit realised by the amount invested.
The magazine subscription costs $45 a year, so for 3 years a subscriber pays 45*3= $135
However the amount he actually paid is $115 for the 3 years.
Gain in this transaction= 135- 115= $20
Return on investment= gain/amount invested
Return on investment= 20/115
Return on investment= 0.17391
Return on investment= 17.391%
This is closes to 18%
Answer:
B. 18%
Explanation:
Assuming another different subscriber decides to go for the $45 per year subscription cost then I'm three years would have paid ($45*3=$135).
The rate of return on the investment for the subscriber that elects to pay the $115 now will be;
$135-$115=$20,
we find the percentage of the difference from $115.
=20/115 x 100 = 17.4% nearest to 18%.
