How much should a man invest in ₹ 50 shares selling at ₹ 60 to obtain an income of ₹ 450, if the rate of dividend declared is 10% ? Also, find his yield percent, to the nearest whole number.

Given,

Face Value = ₹ 50

Market Value = ₹ 60

Dividend Rate = 10%

Required Annual Income = ₹ 450

Let no. of shares sold be x.

By formula,

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

$\Rightarrow 450 = x \times \dfrac{10}{100} \times 50 \\[1em] \Rightarrow 450 = 5x \\[1em] \Rightarrow x = \dfrac{450}{5} = 90.$

Investment = No. of shares × Market value of each share

= 90 × 60 = ₹ 5,400.

By formula,

Yield % = $\dfrac{\text{Income}}{\text{Investment}} \times 100$

= $\dfrac{450}{5400} \times 100$ = 8.33% ≈ 8%.

Hence, the man should invest ₹ 5,400 and the yield percent is 8%.