Return on Investment (ROI) Analysis for Cancer Care Nutraceuticals and Cancerase GPT
1. Investment Overview
Cancerase LLC is seeking a total funding of $500,000 over the next three years for its nutritional product, "Cancer Care Nutraceuticals." The smallest investment accepted is $100,000. The product is expected to deliver a 10% return on investment (ROI) annually over the three-year investment period.
2. ROI Calculation
To understand the return on investment, we calculate the future value of the investment at a 10% annual return rate over three years.
Initial Investment (P): $100,000
Annual ROI (r): 10% or 0.10
Investment Period (t): 3 years
The formula to calculate the future value (FV) of the investment is: FV=P×(1+r)tFV = P \times (1 + r)^tFV=P×(1+r)t
3. Future Value Calculation
For an initial investment of $100,000: FV=100,000×(1+0.10)3FV = 100,000 \times (1 + 0.10)^3FV=100,000×(1+0.10)3 FV=100,000×(1.10)3FV = 100,000 \times (1.10)^3FV=100,000×(1.10)3 FV=100,000×1.331FV = 100,000 \times 1.331FV=100,000×1.331 FV=133,100FV = 133,100FV=133,100
The future value of an initial investment of $100,000 after three years at a 10% annual return is $133,100.
4. ROI Calculation
To calculate the ROI over three years, we use the formula: ROI=(FV−PP)×100%ROI = \left(\frac{FV - P}{P}\right) \times 100\%ROI=(PFV−P)×100%
For the investment: ROI=(133,100−100,000100,000)×100%ROI = \left(\frac{133,100 - 100,000}{100,000}\right) \times 100\%ROI=(100,000133,100−100,000)×100% ROI=(33,100100,000)×100%ROI = \left(\frac{33,100}{100,000}\right) \times 100\%ROI=(100,00033,100)×100% ROI=33.1%ROI = 33.1\%ROI=33.1%
The total ROI for a $100,000 investment over three years is 33.1%.
5. Summary
For an investor considering Cancerase LLC's nutritional product, an investment of $100,000 is expected to grow to $133,100 over three years, resulting in a total return of 33.1%.