#### Question

Mr. Parekh invested Rs. 52,000 on Rs. 100 shares at a discount of Rs. 20 paying 8% dividend. At the end of one year, he sells the shares at a premium of Rs. 20. find

1) The annual dividend

2) The profit earned including his dividend.

#### Solution

Rate of dividend = 8%

Amount invested = Rs. 52,000

Market price = Rs. 100 – Rs. 20 = Rs. 80

Number of shares purchased= Rs. `(52,000)/ 80` = 650

(1) Annual dividend = 650 × 8 = Rs. 5200

(2) On selling market rate = Rs 100 + 20 = Rs 120

⇒ sale price = Rs. 120 × 650 = Rs. 78,000

Profit = Rs. (78,000 – 52,000) = Rs 26000

⇒Total gain = 26000 + 5200 = Rs 31200

Is there an error in this question or solution?

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Solution Mr. Parekh Invested Rs. 52,000 on Rs. 100 Shares at a Discount of Rs. 20 Paying 8% Dividend. at the End of Mium of Rs. 20. Find 1) the Annual Dividend 2) the Profit Earned Including His Dividend. Concept: Shares and Dividends.

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