Question

An investor had bought 250 shares of Polo steels at ₹ 8,800 per share, the face value of each be ₹ 10. The company decided to split the shares so that new face value would be ₹ 1 per share. If the market value of the share after the split is ₹ 875 each, find the number of shares held by the investor after split and his gain/loss after the split.

Answer 1

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total investment =₹8800

NV of 1 share=₹100

MV of 1 share =₹110

no of shares purchased=8800/110

=80

NV of 80 shares=₹80×100

=₹8000

let dividend%=y%

then y% of 8000=1200

or y/100×8000=1200

or 80y=1200

so, y=1200/80

=15%