A company with 10000 shares of ₹100 each, declares an annual dividend of 5%.

(i) What is the total amount of dividend paid by the company?

(ii) What would be the annual income of a man, who has 72 shares, in the company?

(iii) If he received only 4% on his investment, find the price he paid for each share.

(i)
Number of shares = 10000

Nominal value per share = ₹100

Rate of Dividend = 5%

Annual Dividend = No. of shares x Rate of Dividend x Nominal Value per share

$= 10000 \times \dfrac{5}{100} \times 100 \\[0.5em] = \bold{₹50000}$

∴ Total amount of dividend paid by the company = ₹50000

(ii)
Number of shares the man has = 72

$\text{Annual Inc.} = 72 \times \dfrac{5}{100} \times 100 \\[0.5em] = \bold{₹360}$

∴ Annual income of man with 72 shares = ₹360

(iii)
Let price paid by man for each share be ₹x

His total investment = ₹72x

$\% \text{Return} = \Big(\dfrac{\text{Annual Inc.}}{\text{Investment}} \times 100\Big)\% \\[0.5em]$

As per the given,

$4 = \dfrac{360}{72x} \times 100 \\[0.5em] x = \dfrac{360 \times 100}{4 \times 72} \\[0.5em] x = 125$

∴ Price paid by man for each share = ₹125