Question

How much should a man invest in $Rs.100$ shares selling at $Rs.110$ to obtain an annual income of $Rs.1,680$, if the dividend declared is $12\%$ ?

• A. $10000$
• B. $16000$
• C. $15400$
• D. $12000$

Answer 1

The correct option is C $15400$

$\because$ Dividend on 1 share=12 % of Rs.100$=\frac{12}{100}\times 100=Rs.12$

$\therefore$ Number of share brought $=\frac{\text{Total income}}{\text{Dividend on one share}}=\frac{1680}{12}=140$

$\because$Market value of each share $=Rs.110$

Sum invested = Number of share$\times$ MV of one share

$\therefore$Sum invested$=140\times 110=Rs.15400$