Mathematics
₹ 40 shares of a company are selling at 25% premium. If Mr. Wasim wants to buy 280 shares of the company, then the investment required by him is :
₹ 14,000
₹ 16,800
₹ 8,400
₹ 10,000
Shares & Dividends
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Answer
Given,
Face Value = ₹ 40
Premium rate = 25%
Premium = 25% of 40 = = ₹ 10
Number of shares = 280
Market Value = Face Value + Premium = 40 + 10 = ₹ 50
By formula,
Investment = Number of shares × Market Value of each share
= 280 × 50 = ₹ 14,000.
Hence, Option 1 is the correct option.
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