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1.
In order to obtain an income of Rs. 650 from 10% stock at Rs. 96, one must make an investment of:
  • A.
    Rs. 3100
  • C.
    Rs. 6500
  • B.
    Rs. 6240
  • D.
    Rs. 9600
  • Answer & Explanation
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Answer : [B]
Explanation :
 
To obtain Rs. 10, investment = Rs. 96.
 
To obtain Rs. 650, investment = Rs.  
96
10
x 650    = Rs. 6240.  
 
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2.
12500 shares, of par value Rs. 20 each, are purchased from Ram by Mohan at a price of Rs. 25 each. Find the amount required to purchase the shares. If Mohan further sells the shares at a premium of Rs. 11 each, find his gain in the transaction.
  • A.
    Rs. 75000
  • C.
    Rs. 70000
  • B.
    Rs. 85000
  • D.
    Rs. 65000
  • Answer & Explanation
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Answer : [A]
Explanation :
 
Market value of a share = Rs. 25
 
 
  Market value of 12500 shares = Rs. (25 x 12500) = Rs. 312500
 
 
Thus, the amount required to purchase 12500 shares = Rs. 312500
 
Then, Mohan sells these shares at a premium of Rs. 11 each.
 
 
  New market rate per shares = Rs. (20 + 11) = Rs. 31
 
 
 
  Selling price of these shares = Rs. (31 x 12500) = Rs. 387500
 
 
 
  Gain = S.P. C.P. = Rs. (387500 312500) = Rs. 75000  
 
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3.
Find the income by investing Rs. 81000 in 9% stock at 135.
  • A.
    Rs. 5500
  • C.
    Rs. 5400
  • B.
    Rs. 6400
  • D.
    Rs. 6000
  • Answer & Explanation
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Answer : [C]
Explanation :
 
Here, the market value of the stock = Rs. 81000
 
By investing Rs. 135, stock of par value Rs. 100 is available
 
 
  Income on Rs. 135 is Rs. 9  
 
 
  Income on Rs. 81000 is Rs.  
9
135
 x 81000      
 
  = Rs. 5400.    
 
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4.
Brij has 800 shares of par value Rs. 50 each and 600 debentures of par value Rs. 100 each of the company. The company pays an annual dividend of 6% on the shares and interest of 12% on the debentures. Find the total annual income of Brij and rate of return on his investment.
  • A.
    Rs. 9600, 9.6%
  • C.
    Rs. 10600, 10.6%
  • B.
    Rs. 8000, 8%
  • D.
    Rs. 9000, 8.6%
  • Answer & Explanation
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Answer : [A]
Explanation :
 
Annual dividend on 800 shares = Rs.  
800 x 50 x 6
100
   = Rs. 2400  
 
Annual interest on 600 debentures =  
600 x 100 x 12
100
   = Rs. 7200  
 
 
  Total annual income of Brij = Rs. (2400 + 7200) = Rs. 9600  
 
Total investment of Brij = Rs. (800 x 50 + 600 x 100)
 
  = Rs. (40000 + 60000)  
 
  = Rs. 100000  
 
 
  Rate of return =  
9600
100000
 x 100   % = 9.6%  
 
 
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5.
Rs. 9800 are invested partly in 9% stock at 75 and 10% stock at 80 to have equal amount of incomes. The investment in 9% stock is:
  • A.
    Rs. 4800
  • C.
    Rs. 5400
  • B.
    Rs. 5000
  • D.
    Rs. 5600
  • Answer & Explanation
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Answer : [B]
Explanation :
 
Let the investment in 9% stock be Rs. x.
 
Then, investment in 10% stock = Rs. (9800 x)
 
 
9
75
x x =
10
80
 x (9800 - x)
 
3x
25
=
9800 - x
8
     
 
 
  24x = 9800 x 25 25x
 
49x = 9800 x 25
 
x = 5000    
 
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