Aptitude - Stocks and Shares - Discussion

Face value = Rs. 50, Dividend = Rs. 27/2.
Market value = After Rs. 5 discount = 50 - 5 = Rs. 45,
Interest rate = Dividend / Market value * Face value.
= 27/2 / 45 * 50,
= 15,
= 15 %.

Hi soheb dont worry i will explain u
face value is actual value of the share ie

he bought 20 shares at 50 rs
hence face value of 1 share is 50 rs
for 20 shares is 50*20 = 1000rs

now investment or market value is the value calculated after
giving the discount

here discount given is 5rs for 50 rs

so market value for 50 rs is 45 rs

hence market value for 20*50rs is 20*45 = 900rs

now, dividend is always calculated on
FACE VALUE(which is always constant)

so dividend is 13 1/2 is 27/2 % of face value

is dividend = (27/2)*1000 %

= 13500 %
= 13500/100 = 135 rs

now rate of interst = (dividend*100)/market value %

= (135*100)/900 %
15 %

my suggestion to u just go through the imp formulas .... twice

I think u will find some problem in understanding what i have
explained . but u go through the formulas and still u cant understand post ur doubt i will try to explain u the short cut method

Guys! I want to ask a question, because I don't get it how it could be solved!!

How many Rs. 25 shares at Rs 3 discount can be bought for Rs 2222, brokerage being 1%?

Simply 50 - 5 = 45.

20 * 45=900.
100 * 13.5=135.
Face value: 20 * 50 = 1000,
135 ÷ 900 * 100 = 15%.

Actually, I have of listened a lecture on stock and shares. There it was said that total dividend is equal to a number of stocks multiply by dividend percentage. So my answer was 30 percent. I am really confused. Please explain.

The simplest method and easy to understand is :-.

He gets dividend of 27/2 on a Rs. 50 (Face value share).

Dividend is money given on the face value of share of the company you purchase which is set by the company no matter you buy it at a discount or a profit.

So here dividend of Rs. 50 share will be = 27/2 * 50/100 per share = 27/4.

No. of shares = 20.

Total Dividend (Income) = 20*27/4 = Rs. 135.

Rate of Interest = Income/Investment * 100.

Investment = 20* (50-5) = 900.

Rate of Interest = 135/900*100 = 15%.

Thank you @Krishna.

Use this formula u can get easy way to answer.

Rate of return * Market value = Rate of dividend * face value.

Rate of return *45 = 27/2* 50.

So Rate of return = (27*50)/(2*45).

= 15.

Thanks for explaining. @Krishna.

27/2 rupees on 100 as dividend refers.
In question's case, it is 27/2 rupees on investing 90rs,
So simply find out 27/2 is what percent of 90.
(27/2)*100 /90 = 15.
That is the profit.