A man buys ₹ 50 shares in a company which pays 10\% dividend. If the man gets 12.5\% on his investment, at… · ABC26GN5258
Subject: General Aptitude · Chapter: Stocks and Shares · Exam: 2003 · Marks: · Difficulty:
A man buys ₹ 50 shares in a company which pays 10\% dividend. If the man gets 12.5\% on his investment, at what price did he buy the shares?
(a)₹ 37.50
(b)₹ 40
(c)₹ 48
(d)₹ 52
Answer
Answer (as printed): B
Explanation
Dividend on 1 share $=₹\left(\frac{10}{100} \times 50\right)=₹ 5$. ₹ 12.50 is an income on an investment of ₹ 100. ₹5isan income on an investment of ₹ $\left(100 \times \frac{2}{25} \times 5\right)=₹ 40$. ∴ Cost of 1 share $=₹ 40$.
Explanation as extracted from the printed page; notation may be imperfect.