Question

Amit Kumar invests Rs. 36,000 in buying Rs. 100 shares at Rs. 20 premium. The dividend is 15% per annum.

Find:

1. the number of shares he buys;
2. his yearly dividend;
3. the percentage return on his investment.

Give your answer correct to the nearest whole number.

Answer 1

Investment = Rs. 36000

Face value = Rs. 100

Premium = Rs. 20

Dividend = 15%

i. No. of shares

= `(36000)/(120)`

= 300

ii. Dividend

= 15% of (100 × 300)

= ₹ 4500

iii. % Return

= `(4500)/(36000) xx 100`

= `(450)/(36)`

= 12.5%

= 13%