Question

A dividend of 12% was declared on Rs 100 share selling at a certain price . If the rate of return is 15% then amount which needs to be invested to obtain annual dividend of Rs 1440 will be

• A. Rs 14400
• B. Rs 1200
• C. Rs 9600
• D. Rs 4800

Answer 1

The correct option is C

Rs 9600

Rate of return $\times$ M.V = Rate of dividend $\times$ N.V

$\frac{15}{100}\times M.V=\frac{12}{100}\times 100$

M.V of share = Rs 80

Annual income on 1 share 12% of Rs 100

$=\frac{12}{100}\times 100=Rs.12$

No. of share to be bought $=\frac{Totalannualincome}{Annualincomeof1share}$

No. of share bought $=\frac{Rs.1440}{Rs.12}=120$

Amount invested = M.V of share $\times$ No of share bought

$=80\times 120=Rs.9600$