Discussion of Question with ID = 048 under Stocks-and-Shares

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Question

Mr. M buys Rs. 80(face value) shares paying 14% dividend. If his investment is getting him an interest of Rs. 7%, what is the market value of the share?

A

160.

B

170.

C

175.

D

180.

Soln.
Ans: a

Dividend on share of Rs. 80 is $14/100$ × 80.
Rs. 7 is earned on an investment of Rs. 100.
So the dividend $14/100$ × 80 is earned on $100/7$ × $14/100$ × 80 = Rs. 160.

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