Explanation

The formula for calculating the profit margin is:

Profit Margin = (Net Income / Revenue) * 100

Additional information:

The formula for calculating the gross profit margin is:

Gross Profit Margin = (Revenue - Cost of Goods Sold) / Revenue * 100

Explanation

To determine the selling price, we can use the formula:

Selling Price = Cost of Goods Sold (COGS) + Gross Profit

In this case,

the COGS is RS 120

and the gross profit is RS 80.

So, the selling price would be:

Selling Price = RS 120 + RS 80

Selling Price = RS 200

Explanation

The financial metric that measures the efficiency of a company's use is ROI

ROI stands for Return on Investment

formula:

ROI = (Net Income / Initial Investment) * 100

Explanation

NPV is the difference between the present value of cash inflows and cash outflows over a period of time.

NPV stands for Net present value

It is used in capital budgeting and investment planning 

formula:

NPV = Cash Inflow Year 1 / (1 + Discount Rate)^1 + Cash Inflow Year 2 / (1 + Discount Rate)^2 + ... + Cash Inflow Year n / (1 + Discount Rate)^n - Initial Investment

Explanation

1. First, we need to calculate the interest amount for each installment.

Since the loan is to be repaid in three equal installments, the principal amount for each installment would be Rs 15,000 / 3 = Rs 5,000.

2. The interest for each installment can be calculated by multiplying the principal amount by the annual interest rate.

In this case, it would be Rs 5,000 * 0.08 = Rs 400.

3. Since there are three installments, the total interest paid would be Rs 400 * 3 = Rs 1,200.

Therefore, the total interest paid on the loan would be Rs 1,200.

Explanation

Gross Profit = Selling Price - COGS

Gross Profit = Rs 150 - Rs 80

Gross Profit = Rs 70

Explanation

The financial ratio that indicates the proportion of revenue is the gross profit margin.

• subtracting the COGS from the revenue
• and then dividing the result by the revenue.

Explanation

NPV is a financial metric

It is used to assess the value and profitability of an investment.

It is calculated by:

subtracting the initial investment cost from the present value of expected cash inflows.

Explanation

The primary purpose of calculating the NPV of an investment is to assess its profitability.

Explanation

COGS is deducted from revenues (sales) to calculate gross profit and gross margin.

The formula for gross profit is:

Gross Profit = Revenue - COGS.