TEACHING AND LEARNING BASIC INVESTING WORKSHEET LESSON PERSONAL FINANCE AND MONEY MANAGEMENT LESSON PLANS

# RETURN ON INVESTMENT (ROI)

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A worksheet lesson introducing students to the concept of return on investment, or ROI. Return on investment is a basic principle that should be understood before investing money.

 LESSON LEARNED     Return on Investment   Risk

 OTHER SKILLS REINFORCED Addition Percentages (optional) Multiplication (optional)

 SUGGESTED GRADE LEVELS   7+ Worksheet is customizable for multiple levels.

Suggested Lesson Plan for this Worksheet

An investor is someone who commits money, time, or their own effort to get a return on that investment.  One way to measure the value of that return is called return on investment, or ROI.  Return on investment is a calculation of the amount, or percentage, that you have earned (or lost) on an investment you have made.  Returns may be positive or negative.  A positive return on investment would mean you earned money, and a negative return would mean you lost money.  Return on investment is a percentage of the original amount you invested.

Related to return on investment is risk.  Risk is the chance that you will lose money.  Different types of investments will give you different returns, and different amount of risk.  In general,  if you invest in an opportunity with a lot of risk, then you should expect to get a higher return on investment.  Low risk investments should give you a lower return on investment.  For example, if you place your money in an insured bank account, your money might be pretty safe, but the return may be 1%.  If you invest in stocks, you might earn 8%.  However, stocks are more risky, and you actually might lose money instead.

The formula is:

 ROI  = R - I x 100 R = Money received after making the investment. I I = Original money invested.

Example:  John invests \$100 in a mutual fund for one year.  At the end of the year he has \$108.  What was his return on investment?

Answer:  108-100 = 8.   8/100 = .08   .08 * 100 = 8%

WORKSHEET Instructions

This worksheet is an introduction to investing and the concept of return on investment.  Students need to fill in the table with the missing values for each of the problems.

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 Number of Questions     Money to Invest \$ 10 100 1000 10000   Show Gain/Loss Amount Choose to either show amount or have student fill in.   Include answers?  NOTE: Answers appear on a separate page when printed.       Note - requires Full Membership

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Teaching High School Students - Secondary Education - Adults - Special Education - Teens - Teenagers - Kids - Children - Saving Money Instruction

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