Lets work some examples to get comfortable with these equations! Suppose a company has an RI of $100,000 and operating income of $500,000. If the required rate of return is 16%, what is the amount of the investment?

Lets now work an example of the ROI equation. Lets still use the same information from the problem above and calculate ROI (To recap: Suppose a company has an RI of $100,000 and operating income of $500,000. The required rate of return is 16% and the total investment amount was calculated to be $2.5M.)