Mathematics

A dividend of 12% was declared on ₹ 150 shares selling at a certain price. If the rate of return is 10%, calculate :
(i) the market value of the shares.
(ii) the amount to be invested to obtain an annual dividend of ₹ 1,350.

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(i) Let M.V. be ₹ x.

We know that,

Rate of dividend × N.V. = Profit (return) % × M.V.

$\Rightarrow \dfrac{12}{100} \times 150 = \dfrac{10}{100} \times x \\[1em] \Rightarrow x = 180.$

Hence, market value of shares = ₹ 180.

(ii) Let amount to be invested be ₹ y.

No. of shares = $\dfrac{y}{180}$

Annual income = No. of shares × Rate of div. × N.V. of 1 share

$\therefore 1350 = \dfrac{y}{180} \times \dfrac{12}{100} \times 150 \\[1em] \Rightarrow y = 13,500$

Hence, amount to be invested = ₹ 13,500.

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