iSixSigma

Return on Investment (ROI)

Definition of Return on Investment (ROI):

ROI with respect to a project, or project ROI, is an indicator used to measure the financial savings/gain (or loss) of a project in relation to its cost. Typically, it is used in determining whether a project will yield positive financial benefits and in turn be given approval to proceed.

The formula for determining project ROI is: Project ROI = (Financial Gain or Loss – Project Cost / Project Cost) X 100.

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