Question

Mr.Paul has 70 shares of face value Rs.100 each and he decides too sell them when they are at premium of 40% .He invested the proceeds in shares of nominal value of Rs.50 quoted at 2% discount paving 16% dividend annually.Calculate
i.the sales procceds
ii.the number of shares
iii.the number of shares he buys
iv.his annual dividend from these shares

Answer 1

Answer:

1) face value of 1 share =Rs.100

face value of 70 shares =70×100=Rs.7000

Market value of 1 share =Rs.100+40% of Rs.100=100+40=Rs.140

Market value of 60 shares =140×70=Rs.9800[Answer]

2) face value of 1 share =Rs.50

Market value of 1 shares =Rs.50−2% of Rs.50=50−1=Rs.49

No. of shares purchased = 9800/49

=200 shares

3) face value of 200 shares =Rs.50×200=Rs.10000

Dividend %=16%

Dividend =16% of Rs.10000

= 1600 [ ANSWER]

Hope it will help you ✌️