Investment
Return on investment
Return expressed as a percentage of the amount invested
Profit divided by what was put in. In real estate the denominator is often the cash actually invested rather than the purchase price, which is what makes leveraged returns look so different from unleveraged ones.
How the exam asks about it
Read carefully for the base the question wants — total price or cash invested. The arithmetic is trivial; identifying the denominator is the item.
Related terms
Sitting the license exam? Find out what you actually know.
Free practice questions built to the published national content outline, with an explanation after every answer. No account, no paywall.
Independent exam preparation. Real Estate Exam Bank is not a state-approved pre-licensing course and completing anything here does not satisfy any state education requirement. Not affiliated with, endorsed by, or authorized by any state real estate commission, Pearson VUE, or PSI. Practice questions here are original study material, not the official exam.