A man invests Rs. 8,800 in buying shares of a company of face value of rupees hundred each at a premium of 10%.
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 dividend, find:
(i) the number of shares he has in the company.
(ii) the dividend percent per shares.
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Total investment = Rs. 8,800
Nominal value of 1 share = Rs. 100
Market value of 1 share = Rs. 110
∴ No of shares purchased = 8800/110=80
Nominal value of 80 shares = 80 × 100 = Rs. 8,000
Let dividend % = y %
Then y% of Rs. 8,000 = Rs. 1,200
⟹ (/100) ×8,000=.1,200
⟹ y = 15%
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