A product owner must choose between two initiatives. Feature X will cost $40,000 and is expected to return $100,000 in benefits. Feature Y will cost $60,000 and is expected to return $132,000 in benefits. Using return on investment (ROI) as the deciding metric, which feature should be prioritized and why?

Question

Accepted Answer

Feature X, because its ROI of 150% exceeds Feature Y's ROI of 120%. ROI = (Benefit − Cost) / Cost. Feature X: ($100,000 − $40,000) / $40,000 = 150%. Feature Y: ($132,000 − $60,000) / $60,000 = 120%. Feature X delivers more value per dollar invested, so it wins on ROI. Choosing by absolute benefit (B) or lowest cost (C) ignores efficiency; D miscalculates by dividing benefit by cost instead of net benefit.

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