the face value of a share is Rs.100. Aakash purchased 25 shares when its market value was Rs.70.in the year , the company declared 20%dividend. find the rate of return Aakash got on his investment.
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28.57% is the rate of return that Aakash received on his investment.
Step-by-step explanation:
Given,
Face value of each share = Rs. 100
Market value of the share = Rs. 70
No. of shares he purchased = 25
So,
The total amount he invested = 25 * 70
= Rs. 1,750
Dividend declared = 20% (Rs. 20 is the 20% of 100)
∵ The total dividend he receives on 25 shares = 25 * Rs. 20
= Rs. 500
Rate of return = Total dividend/sum invested * 100
= 500/1750 * 100
= 28.57%
Thus, the rate of return on shares is 28.57%.
Learn more: Calculate the rate of return
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