Question

1. The ROI calculation takes the benefit subtracts the cost and multiplies by the prevailing interest rate.

a.True

b. False

2. If you want to know what the money granted your project would be worth over some period of time in a conventional investment (e.g. investing in a S&P 500 index fund) you could gage that by applying which series of calculations:

		a.Return on Investment
		b. Net Present Value
		c. Cost Benefit Analysis
		d. Payback Analysis

Answer 1

1: False

ROI is Net benefits divided by the cost of investment which is the interest rate.

2: B NPV analysis

This returns the net value added by the investment in dollar terms.

ROI returns the ratuen in percentage terms. Cost benefit analysis is a means of comparison of costs vs benefits of an investment. Payback returns the period in which the investment is recovered.