Question

Vivek invests Rs. 4,500 in 8%, Rs.10 shares at Rs. 15. He sells the shares when the price rises to Rs. 30, and invests the proceeds in 12% Rs. 100 shares at Rs. 125. Calculate:

(i) The sale proceeds

(ii) The number of Rs. 125 shares he buys.

(iii) The changes in his annual income from dividend.

Answer 1

Nominal value of 300 shares = Rs. 10 × 300 = Rs. 3000

Dividend = 8% of Rs. 3,000

New nominal value of 72 shares = Rs. 100 × 72 = Rs. 7,200

Dividend% = 12%

New dividend = 12% of Rs. 7,200