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Requirements 1. What is the original retum on investment (ROI) for Hoffman Ceramics (before making any additional investment)? 2. What would the ROI be for

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Requirements 1. What is the original retum on investment (ROI) for Hoffman Ceramics (before making any additional investment)? 2. What would the ROI be for Hoffman Ceramics if this investment opportunity were undertaken? Would the manager of the Hoffman Ceramics division want to make this investment if she were evaluated based on ROI? Why of why not? 3. What is the ROI of the investment opportunity? Would the investment be desirable from the standpoint of Gammaro Corporation? Why or why not? 4. What would the residual income (RI) be for Hoffman Ceramics if this investment opportunity were to be undertaken? Would the manager of the Hoffman Coramics division want to make this investment if she were evaluated based on RI? Why or why not? 5. What is the RI of the investment opportunity? Would the investment be desirable from the standpoint of Gammaro Corporation? Why or why not? 6. Which performance measurement method, ROI or RI, promotes goal congruence? Why

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