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Sachin Invests Rs. 8500 in 10%, Rs 100 Shares at Rs. 170. He Sells the Shares When the Price of Each Share Rises by Rs. 30. He Invests the Proceeds in 12% Rs. 100 Shares at Rs. 125. Find: - Mathematics

Sum

Sachin invests Rs. 8500 in 10%, Rs 100 shares at Rs. 170. He sells the shares when the price of each share rises by Rs. 30. He invests the proceeds in 12% Rs. 100 shares at Rs. 125. Find:
(i) the sale proceeds.
(ii) the number of Rs. 125 shares he buys.
(iii) the change in his annual income.

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Solution

(i) By investing, share bought = 100

By investing, shares bought `= 100/170 xx 8500 = " Rs " . 5000`

Total face value of Rs. 100 shares = Rs. 5000

Income = 10 % of face value 

          ` = 10/100 xx 5000 = " Rs . " 500`

By selling Rs.100 share, money received = 170 + 30 = Rs. 200
By selling Rs. 5000 shares money, money received `= 200/100 xx 5000 = "Rs". 10000`

Sale Proceeds = Rs. 10000

(ii) By investing Rs. 125, No. of Rs. 100 share bought = 1
By investing Rs. 10000, No. of Rs. 100 shares bought `= 10000/125 = 80`

∴ No. of Rs. 125 shares bought = 80

(iii) By investing Rs. 125 in Rs. 100 share, Income = Rs. 12
By investing Rs. 10000 in Rs. 100 share, Income `= 12/125 xx 10000 = "Rs ". 960`

Increase in income = Rs. 960 – Rs. 500 = Rs. 460 

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