Question

A man invests Rs. 3,072 in a company paying 5% per annum when its Rs. 10 shares can be bought for Rs. 16 each. Find:

1. his annual income
2. his percentage income on his investment.

Answer 1

Market value of 1 share = Rs. 16

A nominal value of 1 share = Rs. 10

Money invested = Rs. 3,072

∴ No. of shares purchased = `3072/16` = 192

Nominal value of 192 Shares = 10 × 192 = Rs. 1920

1. Annual income = 5% of Rs. 1920

= `5/100 xx 1920`

= Rs. 96

2. Income% = `96/3072 xx 100%`

= 3.125%

= `3 1/8 %`