Skateboard Sales: Calculating Return on Investment

What is Danny's return on investment (ROI) for selling skateboards?

Is the return on investment positive or negative for Danny?

Answer

Danny's return on investment for selling skateboards is $20 or 57.14%.

The return on investment is positive for Danny.

Explanation

To calculate the return on investment, we need to find the profit made on each skateboard. The profit is the selling price minus the cost to produce the skateboard. In this case, the profit is $55 - $35 = $20.

To express this profit as a percentage of the investment, we need to divide the profit by the investment and multiply by 100%. The investment in this case is the cost to produce a skateboard, which is $35. So the return on investment is ($20 / $35) * 100% = 57.14%.

Therefore, Danny's return on investment is 57.14%.

Final Answer

ROI is calculated by taking the net profit from an investment, divided by the cost of the investment, and multiplied by 100. For Danny, the ROI on selling skateboards is 57.14%.

In business, the Return on Investment (ROI) is calculated by taking the net profit from an investment, dividing it by the cost of the investment, and then multiplying the result by 100 to get a percentage. In Danny's case, he sells skateboards for $55 and it costs him $35 to produce a skateboard. So, the net profit per skateboard is $20 ($55 - $35). His return on investment would be ($20 / $35) * 100 = 57.14%.