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Question
Find the cost of purchasing 150 shares of a company, each of par value ₹ 10, quoted at 16 each in the market, from the original shareholder. Also, find the gain to the new shareholder if he sells each share at a premium of ₹ 10.
Sum
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Solution
Given:
Number of shares = 150
Par value per share = ₹ 10
Market price (purchase price) = ₹ 16
Selling price per share = ₹ 10 premium on ₹ 10 par = ₹ 20
Total cost:
= 150 × ₹ 16
= ₹ 2400
Total selling price:
= 150 × ₹ 20
= ₹ 3000
Gain:
= ₹ 3000 − ₹ 2400
= ₹ 600
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