Question

A man invests Rs. $1600$ in buying shares of nominal value Rs. $50$ each and selling at $10\%$ premium. The dividend on the shares is $20\%$ per annum. calculate the number of shares he buys.

• A. $19$
• B. $29$
• C. $39$
• D. $49$

Answer 1

The correct option is B $29$

Man's investment $=$ Rs. $1600$
N.V. of $1$ share $=$ Rs. $50$
Premium on $1$ share $=10\%$ of Rs. $50=$ Rs. $5$
M.V. of $1$ share $=50+5=$ Rs. $55$
Number of shares bought $=$ $\frac{\text{investment}}{\text{M.V. of 1 share}}=\frac{1600}{55}=29$