Question

Asha buys ₹ 20 shares of a company which pays 9% dividend at such a price that she gets a return of 12% on her investment. At what price did she buy each share?

Options

• ₹ 20

• ₹ 15

• ₹ 25

• ₹ 18

Answer 1

₹ 15

Explanation:

Given: Face Value (FV) of share = ₹ 20

Dividend = 9%

Return on investment = 12%

Formula: Dividend % × N.V. = Return % × M.V.

`9/100 xx 20 = 12/100 xx M.V.`

180 = 12 × M.V.

M.V. = `180/12`

= ₹ 15