Question

Calculate the percentage income in the following investments:

Rs 36,250 in a Rs 125 share paying 8% and available at a premium of Rs 20.

Answer 1

Investment= Rs 36,250 

Nominal value of each share =Rs 125 

Market value =Rs ( 125 +Rs 20) =Rs 145 

No. of shares purchased = `36250/145 = 250`

Face value of 250 shares = Rs 125 x 250 = Rs 31,250 

Dividend = 8 % 

Therefore, Annual Income = `(8 xx 31250)/100` = Rs 2500

Hence, percentage income = `(2500 xx 100)/36250 = 6.9 %`