# Stock and Shares - Excercise 1

## Questions

Directions to solve

1.   A 12% stock yielding 10% is quoted at:

• Rs. 83.33
• Rs. 110
• Rs. 112
• Rs. 120
The Correct answer is :Rs. 120

To earn Rs. 10, money invested = Rs. 100.
To earn Rs. 12, money invested = Rs ${\frac{100}{10}\times12}$ = Rs 120
${\therefore}$ Market value of Rs.100 stock = Rs.120

2.   A man invested Rs. 1552 in a stock at 97 to obtain an income of Rs. 128. The dividend from the stock is:

• 7.50%
• 8.00%
• 9.70%
• None of these

By investing Rs. 1552, income = Rs. 128
By investing Rs. 97, income Rs. ${\frac{128}{1552}\times97}$ =Rs 8
${\therefore}$ Dividend = 8%

3.   By investing Rs. 1620 in 8% stock, Michael earns Rs. 135. The stock is then quoted at:

• Rs. 80
• Rs. 96
• Rs. 106
• Rs. 108
The Correct answer is :Rs. 96

To earn Rs. 135, investment = Rs. 1620
To earn Rs. 8, investment = Rs. ${ \frac{1620}{135}\times8}$ =Rs 96
${\therefore}$ Market value of Rs.100 stock = Rs.96

4.   A man invests some money partly in 9% stock at 96 and partly in 12% stock at 120. To obtain equal dividends from both, he must invest the money in the ratio:

• 3:4
• 3:5
• 4:5
• 16:15

For an income of Re. 1 in 9% stock at 96, investment = Rs.${\frac{96}{9}}$ =${\frac{32}{3}}$
For an income Re. 1 in 12% stock at 120, investment = Rs.${ \frac{120}{12}}$ =10
Ratio of investments =${\frac{32}{3}}$ :10
=32 :30 =16:15

5.   A man invested Rs. 4455 in Rs. 10 shares quoted at Rs. 8.25. If the rate of dividend be 12%, his annual income is:

• Rs. 207.40
• Rs. 534.60
• Rs. 648
• Rs. 655.60
The Correct answer is :Rs. 648

Number of shares = ${\frac{4455}{8.25}}$ = 540
Face value = Rs. (540x10) = 5400
Annual income = Rs.${\frac{12}{100}\times}$5400 = Rs 648

6.   A 6% stock yields 8%. The market value of the stock is:

• Rs. 48
• Rs. 75
• Rs. 96
• Rs. 133.33
The Correct answer is :Rs. 75

For an income of Rs. 8, investment = Rs. 100.
For an income of Rs. 6, investment =Rs ${\frac{100}{8}\times6}$ =Rs 75

7.   In order to obtain an income of Rs. 650 from 10% stock at Rs. 96, one must make an investment of:

• Rs. 3100
• Rs. 6240
• Rs. 6500
• Rs. 9600
The Correct answer is :Rs. 6240

To obtain Rs. 10, investment = Rs. 96.
To obtain Rs. 650, investment = Rs ${\frac{96}{10}\times650}$= Rs 6240