Question

Mohan invested Rs 29,040 in 15% of Rs 100 shares of a company quoted at a premium of 20%. Calculate 

(i) the number of shares bought by Mohan 

(ii) his annual income from shares 

(iii) the percentage return on his investment

Answer 1

Investment = Rs 29,040 

Rate of dividend = 15% 

Number of shares = 100 

Premium = 20%

(i) Number of shares

(ii) Annual income from shares = (Number of shares) x (Face value of a share) x (Rate of dividend) 

= 242 x 100 x \(\frac{15}{100}\) 

= Rs 3630

(iii) The percentage return on his investment