Proforma Investment Decision is the component of a financial plan that helps ascertain the highest possible returns on investment. It involves analyzing various investment options and making informed decisions based on projected financial outcomes.

Below are the key points explaining why Proforma Investment Decision is the correct answer:

1. Proforma Investment Decision:
Proforma investment decision involves estimating the potential returns and risks associated with different investment options. It includes conducting a thorough analysis of the investment alternatives, such as stocks, bonds, real estate, or mutual funds, to determine their profitability and suitability for the investor's financial goals.

2. Projected Financial Outcomes:
By creating proforma investment statements, investors can project the expected financial outcomes of their investments. These statements provide detailed information about the estimated returns, expenses, and risks associated with each investment option. By comparing the projected financial outcomes, investors can make informed decisions to maximize their returns.

3. Assessing Return on Investment:
One of the primary objectives of a financial plan is to maximize the return on investment. The proforma investment decision helps in assessing the potential returns on different investment options by considering various factors such as historical performance, market trends, economic conditions, and risk factors. It enables investors to identify the investments that offer the highest possible returns based on their risk appetite and financial goals.

4. Risk Management:
Another important aspect of proforma investment decision is the evaluation of risks associated with each investment option. Investors need to consider factors such as market volatility, economic uncertainties, industry risks, and regulatory changes that may impact the investment returns. By carefully analyzing and quantifying the risks, investors can make informed decisions to mitigate or manage the risks effectively.

5. Long-term Financial Planning:
Proforma investment decision is crucial in long-term financial planning as it helps investors align their investment choices with their overall financial goals. By considering the potential returns, risks, and investment time horizon, investors can create a diversified investment portfolio that balances risk and return. This ensures that the investments are aligned with the investor's financial objectives and time horizon.

In conclusion, the proforma investment decision is an essential component of a financial plan that helps ascertain the highest possible returns on investment. It involves analyzing investment alternatives, projecting financial outcomes, assessing return on investment, managing risks, and aligning investments with long-term financial goals.