Question

Prashant bought 50 shares of FV Rupees 100, having MV Rupees 180. Company gave 40% dividend on the shares. Find the rate of return on investment. Solve the word problem

Answer 1

Answer:

Shares bought by Prashant= 100 x 50 = ₹5000

You don't receive dividend on MV

You receive it FV of shares=

: 40 x 5000÷ 100= 200000÷100= ₹ 2000

Answer 2

Answer:

rate of return on investment = 11.11 %

Step-by-step explanation:

MV Rupees 180

number of Shares = 50

Investment = MV * Shares = 180 * 50  =  Rs 9000

40% Dividend on Face Value

= (40/100) * 100 = Rs 40 Per Share

Dividend on 50 Shares = 40 * 50 = Rs 2000

Rate of Return on investment = (2000/18000) * 100 = 11.11 %

rate of return on investment = 11.11 %