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Question

If the Face Value of a share is Rs. 100 and market value is Rs 75, then which of the following statements is correct?

A
The share is at a premium of Rs 175
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B
The share is at a discount of Rs 25
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C
The share is at a premium of Rs 25
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D
The share is at a discount of Rs 75
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Solution

The correct option is B The share is at a discount of Rs 25
Face Value of share = Rs. 100
Market Value of share = Rs. 75
FV > MV
Share is at a discount
FVMV =10075=25
The share is at a discount of Rs. 25

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