Question

What is the return on invested capital to an investor who purchased a futures contract at a price of 297 and sells the contract for 308

Answer 1

Answer:

The return on invested capital is 123.5%

Explanation:

The computation of the return on invested capital is shown below;

Return on invested capital is

= (Selling Price - Purchase Price) ÷ (Purchase Price ×  Margin Percentage)

= (308 - 297) ÷ (297 × 3%)

= 123.5%

hence, the return on invested capital is 123.5%

The same is to be considered

We simply applied the above formula