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4

Macro Economics

Profit VS Return

Table of content

What is profit

How to calculate Profit

What is Return on investment

How to calculate ROI

What Is Profit?

An economic profit or loss is the difference between the revenue received from the sale of an output and the opportunity cost of the inputs used

How to Calculate Profit

What is Return on Investment?

A performance measure used to evaluate the efficiency of an

investment or to compare the efficiency of a number of different

investments. ROI measures the amount of return on an investment

relative to the Investment Cost.

How to calculate ROI

Profit ReturnIt is what the business is left

after deducting expenses from revenue

It is anything what business enjoys above principal amount of investment.

Profit is received in two types i.e. Gross Profit and Net

Profit

Return in received in many different types i.e. Interest,

dividend etc.

Profit is Calculated Against cost.

Return is calculated against investment

Difference Between Profit and Return