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Question
Which is better investment : 6% Rs. 100 shares at Rs. 120 or 8% Rs. 10 shares at Rs. 15
Solution
Let the investment in each case = Rs. 120 In the first case,
Dividend on Rs. 120 = Rs. 6
In second case, Dividend on Rs. 10
= `(8 xx 10)/(100)` = 0.8
Now dividend on Rs. 15 = 0.8
then dividend on Rs. 120 = `(0.8 xx 120)/(15)` = Rs. 6.4
It is clear that, second investment i.e. 8%
Rs. 10 shares at 15 is more profitable.
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