Question:Find the annual income by investing Rs. 6800 in 10% stock at 136.
By investing Rs.136, income obtained = Rs. 10 By investing Rs. 6800, income obtained` = Rs. (10/136 xx 6800)` `= Rs. 500`
Question:Which is better investment ? `7 1/2%` stock at 105 or `6 1/2%` stock at 94.
Let the investing in each case be Rs.`(105 xx 94).` Case I : `7 1/2%` stock at 105 : On investing Rs. 105, income` = Rs. 15/2` On investing Rs. `(105 xx 94),` income `= Rs. (15/2 xx 1/105 xx 105 xx 94)` `= Rs. 705.` Case II :` 6 1/2%` stock at 94 : On investing Rs. 94, income` = Rs. 13/2` On investing Rs.`( 105 xx 94)`, income `= Rs. (13/2 xx 1/94 xx 105 xx 94)` `= Rs. (1365)/2` `= Rs. 682.50.` Clearly, the income from` 7 1/2%` stock at 105 is more. Hence, the investment in` 7 1/2%` stock at 105 is better.
Question:Find the cost of 96 shares of Rs. 10 each at` 3/4` discount, brokerage being` 1/4` per share.
Cost of 1 share ` = Rs. [(10 - 3/4) + 1/4]` `= Rs. 19/2.` Cost of 96 shares `= Rs. (19/2 xx 96)` `= Rs. 912.`
Question:Find the income derived from 88 shares of Rs.25 each at 5 premium, brokerage being `1/4` per share and the rate of dividend being `7 1/2`% per annum. Also, find the rate of interest on the investment.
Cost of 1 share` = Rs. (25 + 5 + 1/4)`
`= Rs. 121/4`
Cost of 88 shares` = Rs.(121/4 xx 88)`
`= Rs. 2662.`
:. Investment made` - Rs. 2662.`
Face value of 88 shares` = Rs. (88 xx 25)`
`= Rs. 2200.`
Dividend on Rs.` 100 = 15/2.`
Dividend on Rs. 2200` = Rs. (15/2 xx 1/100 xx 2200)`
`= Rs. 165.`
:. Income derived = Rs. 165.
Rate of interest on investment` = (165/2662 xx 100)`
`= 6.2 %`.Question:A man buys Rs. 25 shares in a company which pays 9% dividend. The money invested is such that it gives 10% on investment. At what price did he buy the shares ?
Suppose he buys each share for Rs. x. Then,` (25 xx 9/100) = (x xx 10/100) or x = 22.50.` :. Cost of each share = Rs. 22.50.