#### Question

A man invests Rs 8,800 in buying shares of a company of face value of rupees hundred each at a premium of 10%. If he earns Rs 1,200 at the end of the year as the dividend, find:

(1) the number of shares he has in the company.

(2) the dividend per cent per share.

#### Solution

Total investment = Rs 8,800

Nominal value of 1 share = Rs 100

Market value of 1 share = Rs 110

∴ No of shares purchased = `8800/110 = 80`

Nominal value of 80 shares = 80 × 100= ₹ 8,000

Let dividend% = y %

then y % of Rs 8,000 = Rs 1,200

`=> "y"/100 xx 8000 = 1200`

`=> "y" = 15%`

Is there an error in this question or solution?

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A Man Invests Rs 8,800 in Buying Shares of a Company of Face Value of Rupees Hundred Each at a Premium of 10%. Concept: Shares and Dividends.

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