Mathematics
Ajay owns 560 shares of a company. The face value of each share is ₹25. The company declares a dividend 0f 9%. Calculate:
(i) the dividend that Ajay will get
(ii) the rate of interest, on his investment, if Ajay has paid ₹30 for each share.
Shares & Dividends
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Answer
Nominal Value per share = ₹25
Rate of Dividend = 9%
No. of shares owned = 560
(i)
Annual Dividend = No. of shares x Rate of Dividend x Nominal Value per share
∴ The dividend that Ajay will get = ₹1260
(ii)
Market Value per share = ₹30
Total Investment = No. of shares x Market Value per share
= 560 x 30
= 16800
∴ Rate of return on Ajay's investment = 7½%
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