Question

₹ 100 shares of a company giving 10% dividend, are available at ₹ 150. Mr. Saha invests ₹ 18,000 to buy these shares. He sells 80% of his shares after one year. Find:

1. the number of shares he purchased.
2. the number of shares he sold
3. his annual income from the remaining 20% shares he still holds.

Answer 1

(i) Given,

Total investment = ₹ 18,000

Market value = ₹ 150

N.V = ₹ 100

By formula,

⇒ Total investment = Number of shares × Market value of one share

⇒ 18000 = Number of shares × 150

⇒ Number of shares = `18000/150`

⇒ Number of shares = 120

Hence, the number of shares Mr.Saha purchased = 120.

(ii) Number of shares sold by Mr Saha = 80% of 120

= `80/100 xx 120`

= 0.8 × 120

= 96

Hence, the number of shares Mr. Saha sold = 96

(iii) Number of shares remaining = Total no. of shares − No. of shares sold

= 120 − 96

= 24

By formula,

Annual income = Number of shares × Rate of dividend × N.V. of 1 share

= `24 xx 10/100 xx 100`

= ₹ 240

Hence, annual income from remaining shares = ₹ 240.