Here’s an example of how a business report or document can include LaTeX formulas to explain financial metrics, profitability calculations, and other key business formulas. You can use this format to introduce mathematical expressions in a business context.
1. Revenue Growth Calculation
To measure revenue growth, we use the following formula:
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\[
\text{Revenue Growth} = \frac{\text{Revenue in Current Period} - \text{Revenue in Previous Period}}{\text{Revenue in Previous Period}} \times 100
\] |
Example:
If a company had revenue of $500,000 in the current period and $450,000 in the previous period, the revenue growth is calculated as:
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\[
\text{Revenue Growth} = \frac{500,000 - 450,000}{450,000} \times 100 = 11.11\%
\] |
2. Break-even Point
The break-even point is where total revenues equal total costs. The formula is:
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\[
\text{Break-even Point (Units)} = \frac{\text{Fixed Costs}}{\text{Selling Price per Unit} - \text{Variable Cost per Unit}}
\] |
Example:
A company with fixed costs of $100,000, selling price per unit of $50, and variable cost per unit of $30 would calculate the break-even point as:
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\[
\text{Break-even Point} = \frac{100,000}{50 - 30} = 5,000 \text{ units}
\] |
3. Net Present Value (NPV)
The NPV of an investment is calculated as:
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\[
NPV = \sum_{t=1}^{T} \frac{C_t}{(1 + r)^t} - C_0
\]
Where:
\(C_t\) = Cash inflow during period \(t\)
\(r\) = Discount rate
\(C_0\) = Initial investment
\(T\) = Total number of periods |
Example:
For an investment with an initial cost of $100,000, cash inflows of $20,000 for the next 6 years, and a discount rate of 8%, the NPV is:
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\[
NPV = \sum_{t=1}^{6} \frac{20,000}{(1 + 0.08)^t} - 100,000
\] |
4. Return on Investment (ROI)
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text | The return is the profit you make as a result of your investments. ROI is generally defined as the ratio of net profit over the total cost of the investment. ROI is most useful to your business goals when it refers to something concrete and measurable, to identify your investment's gains and financial returns. |
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Return on Investment is calculated as:
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\[
ROI = \frac{\text{Net Profit}}{\text{Cost of Investment}} \times 100
\] |
Example:
If a project generates a net profit of $25,000 and the cost of investment is $100,000, the ROI is:
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\[
ROI = \frac{25,000}{100,000} \times 100 = 25\%
\] |