Question

Anna got a high-paying job as a lab technician upon graduation. She took
five years to graduate from a public university and did take out a lot of
loans. What kind of return on investment (ROI) does Anna demonstrate?
Can't determine ROI
Negative ROI
Positive ROI
ОО
Neutral ROI

Answer 1

Answer:

Positive ROI

Explanation:

A positive ROI or positive rate of return occurs when the benefits realized from a project are much more than the costs incurred.  Positive implies that a net effect of a number greater than zero.

Anna did not incur a lot of debts while in college. It suggests she controlled her expenses well. Since Anna has a well-paying job, her income and the cost incurred in college compare favorable. Her benefits are more compared to the cost of education.

Answer 2

B- The return on investments (ROI) that Anna should demonstrate is a positive Return on Investment (ROI). This is due to the excess loans taken by Anna during her education before getting the job.

Anna needs to maintain a hefty savings and needs to pay her liabilities in the forms of loans first because she is under obligation of the lending authority to pay for her education loan along with interest accrued.

• Anna will not end up saving for herself and her needs if she is unable to save the money after paying her dues towards her loan. She has to make sure a healthy return on investments made by her.

• Usually an education loan is an expensive loan with higher rates of interests charged by the bank due to shortage of jobs in the economy due to unemployment flair and hence avoiding the risk associated.

• If her interest rate of loan is around 8% she has to make sure her salary is saving her way more than this loan amount with interest which will be due periodically.

Hence, option B is correct that Anna will have to maintain and demonstrate a positive return on investments followed by her high paying job.

To know more about return on investment, please refer the link below.

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