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Shares and Dividends | Shares and Dividends Exercise 3

Question 30

A man bought 360 ten-rupee shares paying 12% per annum. He sold them when the price rose to Rs. 21 and invested the proceeds in five-rupee shares paying 4 ½ % per annum at Rs. 3.5 per share. Find the annual change in his income.

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Given No. of shares bought = 360

Face value of each share = Rs. 10

Rate of dividend = 12%

Total face value of 360 shares = Rs. 10 x 360 = Rs. 3600

Yearly dividend = (3600 x 12)/100 = Rs 432

On selling the share at Rs 21, the amount received = 21 x 360 = Rs 7560

Face value of new shares = Rs 5

Market value = Rs 3.5

Rate of dividend = 4 ½ % = 9/2 %

Number of shares purchased = 7560/3.5 = (7560 x 10)/35 = 2160

Face value of 2160 shares = 5 x 2160 = Rs 10800

Dividend = (10800 x 9)/ (100 x 2) = Rs 486

Change in income = 486 – 432 = Rs 54 gain.

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Our top 5% students will be awarded a special scholarship to Lido.

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Question 30

A man bought 360 ten-rupee shares paying 12% per annum. He sold them when the price rose to Rs. 21 and invested the proceeds in five-rupee shares paying 4 ½ % per annum at Rs. 3.5 per share. Find the annual change in his income.

Looking to do well in your science exam ? Learn from an expert tutor. Book a free class!

Given No. of shares bought = 360

Face value of each share = Rs. 10

Rate of dividend = 12%

Total face value of 360 shares = Rs. 10 x 360 = Rs. 3600

Yearly dividend = (3600 x 12)/100 = Rs 432

On selling the share at Rs 21, the amount received = 21 x 360 = Rs 7560

Face value of new shares = Rs 5

Market value = Rs 3.5

Rate of dividend = 4 ½ % = 9/2 %

Number of shares purchased = 7560/3.5 = (7560 x 10)/35 = 2160

Face value of 2160 shares = 5 x 2160 = Rs 10800

Dividend = (10800 x 9)/ (100 x 2) = Rs 486

Change in income = 486 – 432 = Rs 54 gain.

Our top 5% students will be awarded a special scholarship to Lido.

subject-cta
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