A man buys $R s . 75$ shares at a discount of $R s . 15$ of a company paying $20 %$ dividend. Find:
(i) the market value of $120$ shares;
(ii) his annual income;
(iii) his profit percent.

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Solution

Nominal value of $1$ share $=$ Rs. $75$
Market value of $1$ share $=$ Rs. $75 -$ Rs. $15$ [ $∵$ The company is giving cut a discount of Rs. $15$ ]
$=$ Rs. $60$
(i) Market value of $120$ shares $=$ Rs. $(120 \times 60)$
$=$ Rs. $7200$
(ii) Nominal value of $120$ shares $=$ Rs. $(75 \times 120)$
$=$ Rs. $900$
$∴$ Annual income of the man $= 20 % \times$ nominal value of $120$ shares
$= \frac{20}{100} \times 9000$
$=$ Rs. $1800$
(iii) Profit $= \frac{A n n u a l i n c o m e}{M a r k e t v a l u e} \times 100 %$
$= \frac{1800}{7200} \times 100 = 25 %$ .

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A man buys Rs. 75 shares at a discount of Rs. 15 of a company paying 20% dividend. Find: (i) the market value of 120 shares; (ii) his annual income; (iii) his profit percent.

A man buys $R s . 75$ shares at a discount of $R s . 15$ of a company paying $20 %$ dividend. Find:
(i) the market value of $120$ shares;
(ii) his annual income;
(iii) his profit percent.