Question

What sum should a person invest in Rs 25 shares, selling at Rs 36, to obtain an income of Rs 720, if the dividend declared is 12%? Also find the percentage return on his income.
(i) The number of shares bought by him.
(ii) The percentage return on his income.

Answer 1

Nominal value of each share = Rs.25
Market value of each share = Rs.36
Total income = ₹720
Rate of dividend = 12%
Total nominal value

= `(100)/(12) xx 720`
= ₹6000
(i) ∴ Number of shares 

= `(6000)/(25)`
= 240
Total investment
= 240 x ₹36
= ₹8640
(ii) Percentage return

= `(720 xx 100)/(8640)`

= `8(1)/(3)`%.