Question

Between 2005 and 2011, Blue Drinks, a multinational beverage corporation, increased its return on investment from $5 million to $25 million. The company was able to do this by expanding its product line to include a wider variety of flavors. The $20 million increase in its return on investment between 2005 and 2011 can be referred to as which of the following?
a. Shareholder value
b. Dividend payment
c. Profit growth
d. Profitability turnover
e. Risk capital

Answer 1

Answer:

C) Profit growth

Explanation:

Since Blue Drinks' return on investment increased, that means that its net profit grew.

The return on investment is a measure of net profit, so when the return on investment increases so does net profit, when return on investment decreases net profit decreases.