Question
Procter & Gamble Company, a multinational consumer goods corporation, invested $2,000,000 in a new production facility, which generated a net income of $500,000 in the
Procter & Gamble Company, a multinational consumer goods corporation, invested $2,000,000 in a new production facility, which generated a net income of $500,000 in the first year of operation. Calculate the return on investment (ROI) for Procter & Gamble Company's new production facility. ROI is a fundamental metric used to evaluate the efficiency and profitability of an investment relative to its cost. Provide a comprehensive breakdown of the ROI calculation, including the formula used, and discuss the implications of the calculated ROI figure for Procter & Gamble Company. Analyze how the ROI metric can aid management in assessing the success of the investment project and making informed decisions regarding future investments. Additionally, discuss the significance of ROI in comparing investment opportunities and allocating capital effectively within Procter & Gamble's business portfolio.
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