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Question
Gayathri wants to have a monthly income of Rs 500.For this she purchased Rs 75 shares of 'V.G.Electronics' paying 20% dividend. How many shares did Gayathri purchased and what is her investment if the market price of the share is Rs 62.50?
Solution
Let x be the no. of shares purchased by Gayathri.
Value of x shares = Rs 75 xx = Rs 7 5x
Dividend for x no. of shares of V.G.Electronics = 20 % of Rs 75 x
= Rs `(20 xx 75 x)/100` = Rs 15 x
Monthly income =Rs 500 = Dividend/12
⇒ Rs `(15 x)/12` = Rs 500
⇒ Rs 15 x = Rs 6000
⇒ x = 400
Hence, Gayathri should purchase 400 shares.
The market price for shares = Rs 62.50 Investment by
Gayathri at Rs 62.50 = Rs (62.50 x 400) = Rs 25,00
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