roi

Vocabulary Word

Definition

ROI, or 'Return on Investment,' is a financial term that measures the efficiency or profitability of an investment. It's calculated by comparing your net profit to your initial investment and is usually expressed as a percentage.

Examples in Different Contexts

In social impact projects, 'ROI' might measure the benefits to society against the funds invested. A project leader could say, 'The ROI on our clean water initiative, in terms of community health, has been beyond commendable.'

Practice Scenarios

Tech

Scenario:

The new data analytics tool certainly helped streamline the workflow. But its overall impact on performance metrics is yet to be evaluated.

Response:

You're right. We should analyze the ROI to understand if the tool was a good investment.

Business

Scenario:

Our new project-based approach has been working well. The overall project costs have decreased, and the quality of output has improved.

Response:

That's great to hear. Do we have any estimates on the ROI for these projects compared to the previous approach?