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Question

A man buys 75, ₹100 shares paying 9 percent dividend. He buys shares at such a price that he gets 12 percent of his money. At what price did he buy the shares?

A
₹75
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B
₹100
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C
₹91
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D
₹68
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Solution

The correct option is A ₹75

Given,

Nominal value of 1 share = ₹100

So, the nominal value of 75 shares = ₹100 × 75 = ₹7,500

And, Dividend % = 9 %

Thus, dividend = 9 % of ₹7,500 = <!--td {border: 1px solid #ccc;}br {mso-data-placement:same-cell;}--> 9100 × ₹7,500 = ₹675

Let’s consider the market price of 1 share = ₹y

Then the market price of 75 shares = ₹75y

And, Profit % on investment = 12%

12% of 75y = ₹675

<!--td {border: 1px solid #ccc;}br {mso-data-placement:same-cell;}--> 12100 × 75y = ₹675

y = ₹75

Therefore, the price of his shares is ₹75 each


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