Question

A man wishes to invest ₹ 2,490. He invests ₹ 900 in `3 1/2%` stock at 75, 850 in 3% stock at 68 and the remainder in 6% stock. If the total yield from his investments is 5%, at what price did he buy the 6% stock?

Answer 1

Given:

Total investment = ₹2490

Investments:

₹ 900 in `3 1/2%` = 3.5% stock at ₹ 75

₹ 850 in 3% stock at ₹ 68

The remaining ₹ 740 (2490 – 900 – 850) in 6% stock at unknown price ₹ x

Total yield (income) = 5% of ₹ 2490 

= ₹ 124.50

Nominal value `= 900/75xx100`

= ₹ 1200

Income = `3.5/100xx1200`

= ₹ 42

Nominal value `= 850/68xx100`

= ₹ 1250

Income = `3/100xx1250`

= ₹ 37.50

Remaining investment = ₹ 740

Nominal value = `740/x xx100`

Income `= 6/100 xx740/x xx100`

`=4440/x`

Total income = ₹ 124.50

42 + 37.5 `+ 4440/x`

= 124.5

`=>79.5+4440/x`

= 124.5

`=> 4440/x =45`

`=>x=4440/45`

= ₹ 98.67