Ajay owns 560 shares of a company. The face value of each share is Rs 25 and the company declares a dividend of $9 %$ . Calculate:
(i) the dividend Ajay would receive.
(ii) the rate of interest on his investment considering that Ajay bought these shares at Rs 30 per share in the market.
[4 MARKS]

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Solution

Each subpart: 2 Marks each

Dividend on 1 share = $9 %$ of Rs 25 = Rs $\frac{9}{4}$
(i) Dividend Ajay would receive = $(\frac{9}{4} \times 560)$ = Rs 1,260
(ii) Rate of interest = $R s (\frac{1260}{30 \times 560}) \times 100 = \frac{15}{2} = 7 \frac{1}{2} %$

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