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Question
Shri Shantilal has purchased 150 shares of FV ₹ 100, for MV of ₹ 120, Company has paid dividend at 7%, then to find the rate of return on his investment, complete the following activity:
Solution: FV = ₹ 100; Number of shares = 150
Market value = ₹ 120
1. Sum investment = MV × No. of Shares
= `square xx square`
∴ Sum investment = ₹ 18,000
2. Dividend per share = FV × Rate of dividend
= `square xx square/100`
= ₹ 7
∴ Total dividend received = 150 × 7
= `square`
3. Rate of return = `"Dividend income"/"Sum inve ted" xx 100`
= `1050/18000 xx 100`
= `square`
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Solution
FV = ₹ 100; Number of shares = 150
Market value = ₹ 120
1. Sum investment = MV × No. of Shares
= 120 × 150
∴ Sum investment = ₹ 18,000
2. Dividend per share = FV × Rate of dividend
= `bb100 xx bb7/100`
= ₹ 7
∴ Total dividend received = 150 × 7
= 1050
3. Rate of return = `"Dividend income"/"Sum inve ted" xx 100`
= `1050/18000 xx 100`
= 5.83%
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