Hundred rupee shares of a company are available in the market at a premium of Rs. 20. Find the rate of dividend given by the company, when a man's return on his investment is 15 percent.

18 %

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20 %

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25 %

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None of these

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Solution

The correct option is B $18 %$
$R s . 100$ share at a premium of $R s .20$ then its market value= $100 + 20 = R s .120$
Profit $= 15 %$
Rate of dividend $\times$ N.V=Profit % $\times$ M.V
Rate of dividend $\times$ $100 = 15 \times 120$
$∴$ Rate of dividend $= \frac{15 \times 120}{100} = 18$ %

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Hundred rupee shares of a company are available in the market at a premium of Rs. 20. Find the rate of dividend given by the company, when a man's return on his investment is 15 percent.

The correct option is B 18%Rs.100 share at a premium of Rs.20 then its market value=100+20=Rs.120Profit=15%Rate of dividend×N.V=Profit % ×M.VRate of dividend × 100=15×120∴Rate of dividend =15×120100=18%

The correct option is B $18 %$
$R s . 100$ share at a premium of $R s .20$ then its market value= $100 + 20 = R s .120$
Profit $= 15 %$
Rate of dividend $\times$ N.V=Profit % $\times$ M.V
Rate of dividend $\times$ $100 = 15 \times 120$
$∴$ Rate of dividend $= \frac{15 \times 120}{100} = 18$ %