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Answer 1

Answer:

Mr.Amol purchase 50 shares of face value 100 when the Market value of the share was 80. Company had given 20% dividend. Find the rate of return on investment.

Step-by-step explanation:

FV=Rs.100

MV=Rs.80

Number of shares purchased =50

Sum invested = Number of shares purchased × MV of each share =50×80=Rs.4,000

Dividend received on each share =20 % of FV of each share =20% of Rs. 100 =

100

20

×100=Rs.20

Total dividend received = Number of shares purchased × Dividend received on each share =50×20=Rs.1000

∴ Rate of return on investment =

Sum−invested

Total−dividend−received

×100% =

4000

1000

×100% =25%

Thus, the rate of return on investment is 25%

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