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
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 percent 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 an 8 percent 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
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 shareholders. If it’s 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
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
Let the rate of dividend
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:
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 a 15% dividend annually. Calculate her annual dividend. If she had bought these shares at a 40% premium, what is the return she gets as a 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:
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
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 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:
Question 15: Which is the better investment: 16% Rs. 100 shares at 80 or 20% Rs. 100 shares at 120?
Answer:
First Investment
Investment
Second Investment
Investment
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
Investment
% return
Second Company
Investment
% return
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 share 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
Second Investment
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:
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 an equal dividend at the end of the year, find the rate percent of the dividend received by B.
Answer:
Brother A
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:
Question 21: A person invested Rs. 19,200 in 15% Rs. 100 shares at a 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
Second Investment
Nominal Price of the share
Market Price of the share
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
Second Investment
Nominal Price of the share
Market Price of the share