Lori bought a car for $6700 and her dad helped her fix it up

Finance Aug 08, 2020

Lori bought a car for $6700 and her dad helped her fix it up. They spend $710 in parts and did the work themselves. Lori was able to sell the car for $11,700. Lori's return on investment was

Expert Solution

Computation of Return on Investment:

Return on Investment = (Sale value - Total investment)/Total investment

Here,

Sale value = $11,700

Total investment = Purchase Price of Car + Cost of Parts = $6,700 + $710 = $7,410

Return on Investment = ($11,700 - $7,410)/$7,410 = 57.89%

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