Question

$\huge \red{❦ \: Question࿐}$


A dividend of 9% was declared on 100 share selling at a certain price. If the rate of return is 7.5%, calculate :

(i) the market value of the share;

(ii) the amount to be invested to obtain an annual dividend of Rs. 630.

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Answer 1

Step-by-step explanation:

You can calculate Interest on your loans and investments by using the following formula for calculating simple interest: Simple Interest= P x R x T ÷ 100, where P = Principal, R = Rate of Interest and T = Time Period of the Loan/Deposit in years

Answer 2

Answer:

$\huge \underline \red{✒Answer࿐}$

$\bold{rate \: of \: return \times M.V = rate \: of \: dividend \times N.V}$

$i. \: \: \: ⟹ \frac{7.5}{100} \times M.V = \frac{9}{100} \times 100 \\ \\ ⟹M.V = 120. \\ \\ M.V \: of \: a \: share = 120$

$ii. \: \: \: annual \: income \: on \: 1 \: share = \frac{9}{100} \times 100 = 9 \\ \\ ⟹ \: number \: of \: share \: bought = \frac{total \: number \: of \: income}{annual \: income \: on \: 1 \: share} \\ \\ ⟹ \: \frac{630}{9} = 70 \\ \\ ⟹ \: amount \: to \: be \: invested = 70 \times 120 = 8400$

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