Percentage return on ₹100, 12% share of a company bought at 4% discount is:

1. 10%

2. 12%

3. 12.5%

4. 16%

Given,

Face value = ₹ 100

Discount = 4%

Discount amount = 4% of face value

= $\dfrac{4}{100} \times 100$

= ₹ 4.

Dividend rate = 12%

Dividend = 12% of face value

= $\dfrac{12}{100} \times 100$

= ₹ 12.

Market price = Face value - Discount

= ₹ 100 - ₹ 4

= ₹ 96.

By formula,

Return = $\dfrac{\text{Dividend earned on one share}}{\text{Market Price of one share}} \times 100$

= $\dfrac{12}{96} \times 100$

= 12.5%

Hence, option 3 is the correct option.