What is ROI?

ROI stands for return on investment. It’s a way to measure the profit you have accrued (or will accrue) against the money invested in a business venture.

In other words, ROI is calculated by dividing your profits by your total cost of capital and then multiplying that number by 100%.
So if something costs $10 and returns $25, your ROI would be: 25/10×100 = 200% or 2x per dollar invested!