A man invested Rs 45,000 in 15% Rs100shares quoted at Rs 125. When the market value of these shares rose to Rs 140, he sold some shares, just enough to raise Rs 8,400. Calculate:
(1) the number of shares he still holds;
(2) the dividend due to him on these remaining shares.
Solution
1) Total investment = Rs 45,000
Market value of 1 share = Rs 125
∴ No of shares purchased = `45000/125 = 360` shares
Nominal value of 360 shares = Rs 100 × 360= Rs 36,000
Let no. of shares sold = n
Then sale price of 1 share = Rs 140
Total sale price of n shares = Rs 8,400
Then n = `8400/140` = 60 shares
The no. of shares he still holds = 360 – 60 = 300
2) Nominal value of 300 shares = Rs 100 × 300 = Rs 30,000
Dividend% = 15%
Dividend = 15% of Rs 30,000
` =15/100 xx 30000 = "Rs" 4500`
