Question

A company with 4000 shares of nominal value of Rs 110 each declares an annual dividend of $15\%$, Calculate:
(i) the total amount of dividend paid by the company.
(ii) the annual income of Shahrukh who hold 88 shares in the company.
(iii) if he received only $10\%$ on his investment, find the price Shahrukh paid for each share.

Answer 1

(i) Total amount of dividend paid by the company
$15\%of4000\times 110=Rs\frac{15}{100}\times 4000\times 110$
= Rs 66000
(ii) Annual income of Shahrukh = $15\%of88\times 110=Rs\frac{15}{100}\times 88\times 110=Rs1452$
(iii) Dividend on 1 share = $15\%of110=Rs\frac{15}{100}\times 110=Rs16.50$
Let price paid by Shahrukh for each share = Rs $x$
His profit on one share = $10\%$ of $x$ = Rs $\frac{x}{10}$
$\frac{x}{10}=16.50\Rightarrow x=Rs165$
Thus, price paid by Shahrukh for each share = Rs 165.