The formula to calculate the Return on Interest (ROIn) is:
\[ ROIn = \left( \frac{IE}{IA} \right) \times 100 \]
Where:
Return on interest (ROIn) is a measure of the profitability of an investment based on the interest earned. It is calculated by dividing the total interest earned by the total investment amount and multiplying by 100 to get a percentage. This metric helps investors understand the efficiency of their investments in generating interest income.
Let's assume the following values:
Using the formula to calculate the Return on Interest:
\[ ROIn = \left( \frac{500}{5000} \right) \times 100 = 10\% \]
The Return on Interest is 10%.
