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Most Frequently Asked Formula's In PPC Interview

CPC: Cost-per Click
Total Spend / Total Number Of Clicks

CPM: Cost- Per Thousand Impressions
 (Total Spend / Total Number Of Impressions) x 1000

CTR: Click-through Rate
Total Clicks / Total Impressions

CPA: Cost Per Acquisition
Total Spend / Total Conversions

CR: Conversion Rate:
(Total Conversion / Total Clicks) X 100

ROI: Return On Investment
(Revenue - Cost) / Investment Cost X 100 (for %)

Keyword Maximum Cost Per Click
Break even CPC = Value of each sale * Conversion rate / 100

Maximum Profitability
Maximum profit attainable = (Value of each sale – Minimum CPC) * Conversion rate * Monthly budget / Minimum CPC

Return On Investment (ROI)
ROI = (Value of each sale * Number of sales / Advertising cost) – 1

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