A man buys 400, twenty-rupee shares at a premium of Rs 4 each and receives a dividend of 12%. Find :

(i) the amount invested by him.

(ii) his total income from the shares.

(iii) percentage return on his money.

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Solution

(i) Nominal value of 1 share = Rs. 20
Market value of 1 share = Rs. 20 + Rs. 4 = Rs. 24
No. of shares purchased = 400
Nominal value of 400 shares = 400 $\times$ 20 = Rs. 8,000
Market value of 400 shares= 400 $\times$ 24 = Rs. 9,600

(ii) Dividend% = 12%
Dividend = 12% of Rs. 8,000
= $\times$ 𝑅𝑠. 8,000 = 𝑅𝑠. 960

(iii) Percentage return = $\times$ 100%
= $\times$ 100% = 10%

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A man buys 400, twenty-rupee shares at a premium of Rs 4 each and receives a dividend of 12%. Find : (i) the amount invested by him. (ii) his total income from the shares. (iii) percentage return on his money.

A man buys 400, twenty-rupee shares at a premium of Rs 4 each and receives a dividend of 12%. Find :

(i) the amount invested by him.

(ii) his total income from the shares.

(iii) percentage return on his money.