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deepaksoni
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At what price should a 6.25% rupèe 100 share be quoted when the money is worth 5%.

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an important question from the book -ML aggarwal( avichal publication)class 10th , chapter3, shares and dividends ……..
it is given that  the money is worth 5%. now we have to find At what price should a 6.25% rupèe 100 share be quoted..
please solve this question as  it has appeared in many a time,

Q no. 30, exercise 3, ML Publication, share and dividends

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  1. Dividend = 6.25%

    Nominal Value = ₹100

    Return = 5%

    We have to find M.V.

    First find the dividend(Income) on 1 share → 6.25% of ₹100( N.V.) = ₹6.25

    Now use the formula → Return% = Income or Dividend / Investment * 100

    5 = 6.25/M.V. * 100

    So, M.V. = 6.25 / 5 * 100 = ₹125

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