3.3.3.2b - Average rate of return

Calculate and interpret average accounting rate of return.

Use b - average rate of return to connect the rule to the data and decision in the question.

This matters because b - average rate of return determines what can be inferred or chosen; begin with the stated conditions and keep the conclusion tied to the evidence.

Example: apply b - average rate of return to one small, clearly defined case, show the key step or comparison, and explain the result in words.

Boundary: b - Average rate of return is not a universal recommendation. Check the syllabus scope, assumptions, units and the limits of the evidence before generalising.