A man invests Rs 8,800 in buying shares of a company of face value of rupees hundred each at a premium of 10%. If he earns Rs 1,200 at the end of the year as divident, find :

(i) the number of shares he has in the company.

(ii) the dividend percent per share.

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Solution

(i)Total investment = Rs. 8,800
Nominal value of 1 share = Rs. 100
Market value of 1 share = Rs. 110
∴ No of shares purchased = = 80

(ii)Nominal value of 80 shares = 80 $\times$ 100 = Rs. 8,000
Let dividend % = y %
Then y% of Rs. 8,000 = Rs. 1,200
⟹ $\times$ 8,000 = 𝑅𝑠. 1,200
⟹ y = 15%

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A man invests Rs 8,800 in buying shares of a company of face value of rupees hundred each at a premium of 10%. If he earns Rs 1,200 at the end of the year as divident, find : (i) the number of shares he has in the company. (ii) the dividend percent per share.

(i)Total investment = Rs. 8,800 Nominal value of 1 share = Rs. 100 Market value of 1 share = Rs. 110 ∴ No of shares purchased = = 80 (ii)Nominal value of 80 shares = 80 × 100 = Rs. 8,000 Let dividend % = y % Then y% of Rs. 8,000 = Rs. 1,200 ⟹ × 8,000 = 𝑅𝑠. 1,200 ⟹ y = 15%

A man invests Rs 8,800 in buying shares of a company of face value of rupees hundred each at a premium of 10%. If he earns Rs 1,200 at the end of the year as divident, find :

(i) the number of shares he has in the company.

(ii) the dividend percent per share.

(i)Total investment = Rs. 8,800
Nominal value of 1 share = Rs. 100
Market value of 1 share = Rs. 110
∴ No of shares purchased = = 80

(ii)Nominal value of 80 shares = 80 $\times$ 100 = Rs. 8,000
Let dividend % = y %
Then y% of Rs. 8,000 = Rs. 1,200
⟹ $\times$ 8,000 = 𝑅𝑠. 1,200
⟹ y = 15%