1.

Rs. 50 shares of a company are quoted at a discount of 10%. Find the rate of dividend given by the company, the return on the investment on these shares being 20 per cent.

Answer»

Nominal value of 1 share = Rs. 50

Market value of 1 share = Rs. 50 − 10% of Rs. 50

= Rs. 50 – Rs. 5 = Rs. 45

Profit % on investment = 20%

Then profit on 1 share = 20% of Rs. 45 = Rs. 9

∴ Dividend % = (9/50) ×100%=18% Ans.



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