an important question from the book -ML aggarwal( avichal publication)class 10th , chapter3, shares and dividends ……..
This type of question has been asked in paper. so please solve it in detail.
we have been asked At what price should a 6.25% rupèes 50 share be quoted on the condition the money is worth 10%.
Q no. 31, exercise 3, ML Publication, share and dividends
Given-
Dividend = 6.25%
Nominal Value = Rs 50
Return = 10%
We have to find M.V.
First find the dividend(Income) on 1 share → 6.25% of Rs.50( N.V.) = Rs.3.125
Now use the formula → Return% = (Income or Dividend / Investment )* 100
5 = 3.125/M.V. * 100
So, M.V. = (3.125 / 10 )* 100 = Rs. 31.25