Question 1: A man buys 75, Rs. 100 shares paying 9% dividend. He buys shares at such a price that he gets 12% of his money. At what price did he buy the shares?

Answer:

Nominal Price of the share

Let the Market Price of the share

Dividend earned

Therefore

Therefore the market price of the share

Question 2: By purchasing Rs. 25 gas shares for Rs. 40 each, a man gets 4 percent profit on his investment. What rate per cent is the company paying? What is his dividend if he buys 60 shares?

Answer:

Nominal Price of the share

Market Price of the share

Number of Shares bought

Let the % dividend

Therefore

Question 3: 100 Rs. 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%.

Answer:

Nominal Price of the share

Market Price of the share

Let the % dividend

Let us say that the person bought 100 shares.

Therefore

Question 4: 50 shares of a company are quoted at a discount of 10%. Find the rate of dividend given by the company, the return on the investment on these shares being 20%.

Answer:

Let Nominal Price of the share

Therefore Market Price of the share

Number of Shares bought

Let the % dividend

Therefore

Question 5: A company declares 8 per cent dividend to the shareholders. If a man receives Rs. 2840 as his dividend, find the nominal value of his shares.

Answer:

Let the nominal Value of the shares

Therefore

Question 6: How much should a man invest in Rs. 100 shares selling at Rs. 110 to obtain an annual income of Rs. 1680, if the dividend declared is 12%?

Answer:

Nominal Price of the share

Market Price of the share

Let the number of Shares bought

Therefore

Hence the investment

Question 7: A company declares a dividend of 11.2% to all its share holders. If its Rs. 60 share is available in the market at a premium of 25%, how much should a person invest, in buying the shares of this company, in order to have an annual income of Rs. 1680?

Answer:

Nominal Price of the share

Market Price of the share

Let the number of Shares bought

Therefore

Hence the investment

Question 8: A man buys 400, 20 Rs. shares at a premium of Rs. 4 each and receives a dividend of 12%. Find: i) The amount invested by him; ii) His total income from the shares. iii) Percentage return on his money;

Answer:

Nominal Price of the share

Market Price of the share

The number of Shares bought

Amount invested

Income from the shares

% return on his money

Question 9: A man buys 400, 20 Rs. shares at a discount of 20% and receives a return of 12% on his money. Calculate: i) The amount invested by him; ii) The rate of dividend paid by the company.

Answer:

Nominal Price of the share

Market Price of the share

The number of Shares bought

Amount invested

Return on investment

Let the rate of dividend

Therefore

Question 10: A company, with 10,000 shares of Rs. 100 each, declares an annual dividend of 5%. i) What is the total amount of dividend paid by the company? ii) What should be the annual income of a man who has 72 shares in the company? iii) If he received only 4% of his investment, find the price he paid for each share.

Answer:

Annual Dividend

Annual income of the man

Let the price of the share he bought was

Therefore the investment

Hence

Question 11: A lady holds 1800, Rs. 100 shares of a company that pays 15% dividend annually. Calculate her annual dividend. If she had bought these shares at 40% premium, what is the return she gets as percent on her investment, Give your answer to the nearest integer.

Answer:

Annual dividend

Investment

% return

Question 12: man invests Rs. 11200 in a company paying 6% per annum when its Rs. 100 shares can be bought for Rs. 140. Find; i) His annual dividend ii) His % return on his investment

Answer:

Number of shares bought

Annual dividend

Percentage return

Question 13: A person has 60 shares of Nominal Value Rs. 100 and sells them when they are at a premium of 60% he invests the proceeds in shares of nominal value Rs. 50, quoted at 4% discount, and paying 18% dividend annually. Calculate; i) The sale proceeds; ii) The number of shares he buys and iii) His annual dividend from the shares.

Answer:

Initial Investment

Sale Proceeds

New Investment is at Rs. 48 per share

Number of shares bought

Annual dividend

Question 14: A company with 10,000 shares of nominal value Rs. 100 declares an annual dividend of 8% to the shareholders. i) Calculate the total amount of dividend paid by the by the company ii) A man had bought 90 shares of the company at Rs. 150 per share. Calculate the dividend he receives and the percentage of the return on his investment.

Answer:

Total dividend paid

The dividend man will receive

% return on his investment

Question 15: Which is the better investment: 16% Rs. 100 shares at 80 or 20% Rs. 100 shares at 120?

Answer:

First Investment

Dividend on 16% Rs. 100 shares at 80

Investment

% return

Second Investment

Dividend on 20% Rs. 100 shares at 100

Investment

% return

Hence the first investment is better.

Question 16: A man has a choice to invest in 200 Rs. shares of two firms at Rs. 120 or at 132. The first firm pays a dividend of 5% per annum and the second firm pays a dividend of 6% per annum, Find: i) Which company is giving a better return. ii) If a man invests Rs. 26,400 with each firm, how much will be the difference between the annual return from the two firms.

Answer:

First Company

Dividend earned

Investment

% return

Return on investment of Rs. 26400

Second Company

Dividend earned

Investment

% return

Return on investment of Rs. 26400

Therefore the Second company gives a better return.

Difference between the annual return = 200 Rs.

Question 17: A man bought 360, 10 Rs. shares of a company, paying 12% per annum. He sold the shares when their price rose to Rs. 21 per shares and invested the proceeds in 5 rupees shares paying 4.5% per annum at Rs. 3.50 per share. Find the annual change in his income.

Answer:

First Investment

Dividend income

Second Investment

Dividend income

Hence difference in income

Question 18: A man sold 400 (Rs. 20) shares of a company, paying 5% at Rs.18 and invested the proceeds in (Rs. 10) shares of another company paying 7% at Rs. 12. How many Rs.10 shares did he buy and What was the change in his income?

Answer:

Income from first investment

No of Rs. 10 shares bought

Dividend income

Hence the difference

Question 19: Two brothers A and B invests Rs. 16,000 each in buying shares of two companies. A buys 3% 100 Rs. shares at 80 and B buys 10 Rs. shares at par. If they both receive equal dividend at the end of the year, find the rate percent of the dividend received by B.

Answer:

Brother A

Dividend

Brother B

Dividend = 600 Rs.

Question 20: A man invests Rs. 20,020 in buying shares of N.V. Rs. 26 at 10% premium. The dividend on the shares is 15% per annum. Calculate: i) The number of shares he buys; ii) The dividend he receives annually; iii) The rate of interest he gets on his money. [2012]

Answer:

Number of shares

Dividend

% rate of interest he gets

Question 21: A person invested Rs. 19,200 in 15% Rs. 100 shares at 20% discount. After a year She sold these shares at Rs. 90 each and invested the proceeds (including her dividend) in 20%, Rs. 50 shares at Rs. 42. Find: i) The number of shares he buys. ii) The dividend he receives annually; iii) The rate of interest he gets on his money.

Answer:

First Investment

Nominal Price of the share

Market Price of the share

Number of shares

Dividend Income

Rate of interest

Second Investment

Nominal Price of the share

Market Price of the share

Number of shares

Dividend Income

Rate of interest

Question 22: A person invested Rs. 19,200 in 15% Rs. 100 shares at 20% premium. After a year She sold these shares at Rs. 140 each and invested the proceeds (including her dividend) in 20%, Rs. 20 shares at Rs. 16. Find: i) dividend for the first year ii) annual income in the second year, iii) % change in the return on her original investment.

Answer:

First Investment

Nominal Price of the share

Market Price of the share

Number of shares

Dividend Income

Rate of interest

Second Investment

Nominal Price of the share

Market Price of the share

Number of shares

Dividend Income

Rate of interest