Question 1: A man invests Rs. 8,800 in buying shares of a company of face value of Rs. 100 each at a premium of 10%. If he ears 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 share. ** [2001]**

Answer:

Nominal price of the share .

Cost price of the share .

Number of shares bought

Dividend earned

Let the dividend % . Therefore

Question 2: A man invests Rs. 1680 in buying shares of nominal value Rs. 24 and selling at 12% premium. The dividend on the shares is 15% per annum. Calculate: i) The number of shares he buys; ii) The dividend he receives. ** [1999]**

Answer:

Nominal price of the share .

Selling price of the share .

Number of shares bought

Dividend received .

Question 3: By investing Rs. 7500 in a company paying 10% dividend, an annual income of Rs. 500 is received. What price is paid for each of Rs.100 shares? ** [1990]**

Answer:

Let the premium

Market price

Therefore

Hence the price paid for each share

Question 4: 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 5: A man invested Rs. 45,000 in 15% Rs.100 shares quoted at Rs. 125, when the M.V. of these shares rose to Rs. 140, he sold some shares, just enough to raise Rs. 8400. calculate: i) The number of shares he still holds; ii) The dividend due to him on these remaining shares. ** [2004]**

Answer:

Nominal Value of the share

Market Value of the share

Number of shares bought

Selling Value of the share

Amount of money raised

Therefore number of shares sold

Shares left

Dividend earned on remaining shares

Question 6: Vivek invests Rs. 4,500 in 8%, Rs.10 shares at Rs. 15. He sells the shares when the price rises to Rs. 30, and invests the proceeds in 12% Rs. 100 shares at Rs. 125. Calculate; i) The sale proceeds ii) The number of Rs. 125 shares he buys; iii) The change in his annual income from dividend. **[2010]**

Answer:

First Investment

Let the amount invested

Nominal Value of the share

Market Value of the share

Dividend earned

Number of shares bought

Sale Proceed

Dividend earned

Second Investment

Therefore the amount invested

Nominal Value of the share

Market Value of the share

Dividend earned

Number of shares bought

Dividend earned

Hence the change in income

Question 7: Mr. Parekh invested Rs. 52,000 on Rs. 100 shares at a discount of Rs. 20 paying 8% dividend. At the end of one year he sells the shares at a premium of Rs. 20; find: i) The annual dividend; ii) The profit earned including his dividend. **[2011]**

Answer:

Nominal Value of the share

Market Value of the share

Number of shares bought

Dividend earned

Sale proceeds

Profit

Question 8: Salman buys 50 shares of face value Rs. 100 available at Rs. 132. i) What is his investment? ii) If the dividend is 7.5%, what will be his annual income? iii) If he wants to increase his annual income by Rs. 150, how many extra shares should he buy? ** [2013]**

Answer:

Nominal Value of the share

Market Value of the share

Number of shares bought

Investment

Dividend earned

Dividend earned on 1 share

Therefore to earn 150 Rs. more, one needs to buy shares.

Question 9: Salman invests a sum of money in Rs. 50 shares, paying 15% dividend quoted at 20% premium. If his annual dividend is Rs. 600, Calculate; i) The number of shares he bought; ii) His total investment; ii) The rate of return on his investment. ** [2004]**

Answer:

Nominal Value of the share

Market Value of the share

Dividend earned

Dividend earned on 1 share

Number of shares bought

Investment

Question 6 has been answered incorrectly. When you were finding the second income, you calculated it wrong. It should be Rs. 864 and not Rs. 720.

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