Investors are also looking how many pesos they earned for every peso they put in. there are ways to calculate the return on investment and the most common is presented here. To illustrate: the cost of a lot is P200,000 and you expect to sell it for a net return of P250,000 a year later. By using the formula below, your return on investment is 25 percent (50,000/200,000). In the example, the ROI formula like the payback method does not consider the time value of money if you held on to the investment for a certain number of years.
Return of Investment = Net Income/Total Investment
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