1
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Question 1 • Quiz

How is "return on investment (ROI)" best defined?

Answer
A
the total assets minus total liabilities
B
the amount of revenue generated in a year
C
the efficiency of an investment in generating earnings relative to its cost
D
the total value of liquid assets

Explanation

Return on investment measures how effectively an investment generates earnings compared with the amount invested. Choice C describes this relationship between earnings and cost. The other choices refer to balance-sheet values or annual revenue, not investment efficiency.

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