MCQ

MCQ 11 Mark

The sum invested to purchase 15 shares of a company of nominal value 75 available at a discount of 20% is:

A
60
B
90
C
1350
✓
900

Answer

Correct option: D.

900

(d) 900
Explanation:
Number of shares purchased =15
Market value of each share $=75-\frac{20}{100} \times 75$
= 75-15=60
Total money invested to purchase 15 shares
$=15 \times 60={ } 900$

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MCQ 21 Mark

1.5% 50 shares at 120
2.7% 100 shares at 120
3.8% 10 shares at 13.50
Which is better investment above?

✓
Investment 1
B
Investment 2
C
Investment 3
D
Investment 1 = Investment 2 = Investment 3

Answer

Correct option: A.

Investment 1

(a) Investment 1
Explanation:
In the first case
Income on 120 = 5% of 50
$=\frac{5}{50} \times 100=10$
$\therefore$ Income on $1=\cdot \frac{10}{120}=\frac{10}{120} \times \frac{9}{9}=\cdot \frac{90}{1080}$
In the second case
Income on $120=7 \%$ of' $100=\frac{7}{100} \times 100={ } 7$
$\therefore$ Income on $1=\frac{7}{120} \times \frac{9}{9}= \frac{63}{1080}$
In the first case
Income on $13.50=8 \%$ of $10={ }\frac{8}{10}$
Income on $1={ } \frac{8}{10 \times 13.50}=\cdot \frac{8 \times 8}{135 \times 8}$
$=\cdot \frac{64}{1080}$
Since $63<64<90$. Therefore, the investment in the first case is better than the investment in the other case.

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MCQ 31 Mark

12% 25 shares at a discount of 5 means that:
1. The dividend on 1 share = 3 p.a.
2. The rate of return p.a. $=\left(\frac{3}{20} \times 100\right) \%=15 \%$
Which of the statement is valid?

A
only 1
B
only 2
✓
both 1 and 2
D
neither 1 and 2

Answer

Correct option: C.

both 1 and 2

(c) both 1 and 2
Explanation:
1. The dividend on 1 share = 12% of 25
$=\cdot\left(\frac{12}{100} \times 25\right)$ p.a. $={ }3$ p.a.
2. The rate of return p.a. $=\left(\frac{3}{20} \times 100\right) \%=15 \%$
Therefore, both statements are valid.

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MCQ 41 Mark

1. Shares of company A, paying 12%, 100 shares are at 80.
2. Shares of company B, paying 12%, 100 shares at 100.
3. Shares of company C, paying 12%, 100 shares are at 120.
Shares of which company are at premium?

A
Company A
B
Company B
✓
Company C
D
Company A and C

Answer

Correct option: C.

Company C

(c) Company C
Explanation:
A share premium is the amount of money that a company receives for its shares over and above their nominal value.

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MCQ 51 Mark

Miss Parisa invests 24,840 on 10% dividend, 20 shares of a company. If the receives a dividend of 2,400, then marked value of each share will be:

✓
20.70
B
21.75
C
18.75
D
19.7

Answer

Correct option: A.

20.70

(a) 20.70
Explanation:
Dividend on each share = 10% of 20
$\frac{10}{100} \times 20={ } 2$
$\therefore$ No. of shares bought $=\frac{\text { botal dividend }}{\text { Devidend on ench share }}$
$\frac{2400}{2}=1200$
$\therefore$ Market value of each share
$=\frac{\text { Total investment }}{\text { No, of shares bought }}$
= $\frac{24840}{1200}={ } 20.70$

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MCQ 61 Mark

Satyam buys shares at the par value of 20 yielding 10% at the end of a year, then number of shares bought if he receives a dividend of 300 is:

A
200
✓
300
C
400
D
500

Answer

Correct option: B.

300

(b)300
Explanation:
Dividend = Number of shares x face value x rate of dividend
$\begin{array}{l}300=n \times 10 \times \frac{10}{100} \\ n=\frac{300 \times 100}{10 \times 10} \\ n=300\end{array}$

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MCQ 71 Mark

The dividend received on 80 shares of ' 30 each if $9 \%$ dividend is declared is:

✓
216
B
316
C
408
D
208

Answer

Correct option: A.

216

(a) 216
Explanation:
Value of one share = 30
Value of 60 share $= 30 \times 80$
Dividend $=9 \%$ of ${ } 2400$
$=\frac{9}{100} \times 2400=216$

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MCQ 81 Mark

Vikul buys 720 shares at 20 per share and gets dividend of 2,160 then rate of return is:

A
10%
B
12%
C
14%
✓
15%

Answer

Correct option: D.

15%

(d) 15%
Explanation:
Instrument $=$ No. of shares $\times$ price of share
$=720 \times 20=14400$
$\therefore$ Rate of return $=\frac{\text { Dividend }}{\text { Investment }} \times 100$
$=\frac{2160}{14400} \times 100=15 \%$

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MCQ 91 Mark

Prakul invests 4800 in shares of a company which is paying 20% dividend. If 100 shares are available at a discount of 20%, then his annual income will be:

A
760
B
860
✓
960
D
1,060

Answer

Correct option: C.

960

(c) 960
Explanation:
No. of shares $=\frac{\text { livestrent }}{M . V .}$
$=\frac{4800}{80}=60$
Annual income = Rate of dividend x no. of shares x face value
$=\frac{20 \times 60 \times 80}{100}$
= 960

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MCQ 101 Mark

200 shares of a company are selling at 80. If the company is paying a divident of 20% then rate of return is:

A
55%
✓
50%
C
60%
D
25%

Answer

Correct option: B.

50%

(b) 50%
Explanation:
Dividend $=\frac{20 \times 200}{100}=$ 40
Return rate $=\frac{40}{80} \times 100=50 \%$

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MCQ 111 Mark

Ritesh buys 560 shares at 30 per share and gets dividen of 1260 then rate of return is:

A
5.5%
B
4.5%
✓
7.5%
D
6.5%

Answer

Correct option: C.

7.5%

(c) 7.5%
Explanation:
Rate of return $=\frac{\text { Dividend }}{\text { lnvestment }} \times 100$
$\because$ Investment $=$ No. of shares
× price of 1 share
= 560x30 =16800
$\therefore$ Return rate $=\frac{1260}{16800} \times 100$
= 7.5%.

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MCQ 121 Mark

Arun owns 560 shares of a company. Face value of each share is 25, dividend is of 9% then divident he will get is:

A
1265
✓
1260
C
1206
D
1200

Answer

Correct option: B.

1260

(b)1260
Explanation:
Dividend $=$ No. of shares $\times$ face value
$\times$ rate of dividend
$=\frac{560 \times 9 \times 25}{100}=$ 1260

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MCQ 131 Mark

25 shares of a company are selling at "20. If the company is paying a dividend of 12% then rate of return is:

A
16%
✓
15%
C
17%
D
15.1%

Answer

Correct option: B.

15%

(b) 15%
Explanation:
Dividend = 12% of Nominal value
$=\frac{12}{100} \times 25=\cdot 3$
Return (profit) % (on market value)
$=\frac{3}{20} \times 100=15 \%$
$\Rightarrow$ rate of return = $15 \%$.

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MCQ 141 Mark

Neeraj possesses 600 shares of 25 of a company. If the company announces a dividend of 8% then his annual income is:

A
1201
✓
1200
C
1205
D
1202

Answer

Correct option: B.

1200

(b) 1200
Explanation:
Investment = No. of shares
$\times$ Rate of 1 share
$=600 \times 25$
= 15000
Annual income = 8% of investment
$=\frac{8}{100} \times 15000=$ 1200

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MCQ 151 Mark

40 shares of a company are selling at 25% premium. If Nitesh want to buy 280 shares then the investment is:

A
16000
B
17000
✓
14000
D
15000

Answer

Correct option: C.

14000

(c) 14000
Explanation:
Market value = 40+ 25% of 40
$=40+\frac{25}{100} \times 40$
= 50
Investment $=280 \times 50$
= 14000

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MCQ 161 Mark

Which is the better investment
(1) 16%, 100 shares at 80
(II) 20% 100 shares at 120?

✓
Only I
B
Both I & II have equal values
C
Only II
D
Can't be determined

Answer

Correct option: A.

Only I

(a) Only I
Explanation:
(1) 16% of 100
$\Rightarrow$ Dividend $=\frac{16}{100} \times 100=$ 16
Market value = 80
$\%$ profit $=\frac{16}{80} \times 100=20 \%$
(II) Dividend = 20% of 100
$=\frac{20 \times 100}{100}=20$
Market value = 120
% Profit return $=\frac{20}{120} \times 100=16-67 \%$.

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MCQ 171 Mark

Anita buys 400, twenty rupees shares at a discount of 20% and receives a return of 12% on his money. Calculate the amount invested by her:

✓
6400
B
6401
C
6500
D
6600

Answer

Correct option: A.

6400

(a) 6400
Explanation:
Discount = 20% of Nominal value
$=\frac{20}{100} \times 20=$ 4
$\Rightarrow$ Market value $=(20-4)=$ 16
Investment = No. of shares
$\times$ marked value of 1 share
$=400 \times 16$
= 6400

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MCQ 181 Mark

100 shares of a company are available in the market at a premium of 20. Find rate of dividend given by the company when a man's return on his investment is 15%:

A
17%
B
16%
C
18.5%
✓
18%

Answer

Correct option: D.

18%

(d)18%
Explanation:
Nominal value = 100
Market value = 100+20=120
His return $=\frac{15 \times 120}{100}=$ 18
$\therefore$ Dividend rate $=\frac{18}{100} \times 100=18 \%$

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MCQ 191 Mark

By purchasing 25 gas shares from 40 each a man gets 4% profit on his investment. The rate percentage is the company paying will be:

A
6.04%
B
6.004%
✓
6.4%
D
60.4%

Answer

Correct option: C.

6.4%

(c)6.4%
Explanation:
Nominal value = 25
Market value = 40
Profit on market value $=\frac{4 \times 40}{100}={ } 1-6$
Dividend rate $=\frac{16}{25} \times 100$
= 6-4%.

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MCQ 201 Mark

Market value of 160, 25 shares at a discount of 6 is:

A
3000
✓
3040
C
3042
D
3400

Answer

Correct option: B.

3040

(b) 3040
Explanation:
Market value of 1 share = 25-6
= 19
M.V. of 160 shares
= 160 x 19
=3040

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MCQ 211 Mark

Face value is also known as:

A
Fair value
✓
Nominal value
C
Market value
D
None of these

Answer

Correct option: B.

Nominal value

(b) Nominal value

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MCQ 221 Mark

Total dividend is also known as:

✓
Annual income
B
No. of shares
C
Half yearly income
D
None of these

Answer

Correct option: A.

Annual income

(a) Annual income

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MCQ 231 Mark

Rishi invests 20020 in buying shares of nominal value 26 at 10% premium. The dividend on shares is 15% per annum then no. of shares he buys:

A
600
B
650
C
750
✓
700

Answer

Correct option: D.

700

(d) 700
Explanation:
Market value $=26+\frac{10}{100} \times 26={ } 28 \cdot 6$
$\because$ No. of shares $=\frac{\text { Investment }}{\text { M.V. }}$
$=\frac{200120}{286}=700$ shares.

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MCQ 241 Mark

Shahina invests 9620 on 100 shares at 80. If the company pays her 18% dividend then her total dividend is:

A
2100
B
2200
✓
2160
D
2106

Answer

Correct option: C.

2160

(c) 2160
Explanation:
Total dividend = Rate of dividend $\times$ no. of shares $\times$ face value
$\begin{array}{l}=\frac{18 \times 120 \times 100}{100} \\ {[\because \text { face value }=100]} \\ {\left[\text { no. of shares }-\frac{9620}{80}=120\right]} \\ =\ 2160\end{array}$

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MCQ 251 Mark

Manik invests 9600 on 100 shares at 80. If the company pays him 18% dividend then number of shares he buys:

✓
120
B
121
C
125
D
122

Answer

Correct option: A.

120

(a) 120
Explanation:
$\begin{array}{l}\text { No. of shares }=\frac{\text { thwestment }}{\text { Market value }} \\ =\frac{9600}{80}=120 \text { shares. }\end{array}$

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MCQ 261 Mark

The money required to buy 50,40 shares quoted at 38-50 is:

A
1920
B
1952
C
1924
✓
1925

Answer

Correct option: D.

1925

(d) 1925
Explanation:
Quoted price = 38.50
No. of shares = 50
$\begin{array}{l}\Rightarrow \text { Investment }=38.50 \times 50={ } 1925 \\ \Rightarrow \text { Money requires }={ } 1925 .\end{array}$

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MCQ 271 Mark

Amount of dividend on 1000 shares of 50 each of at the rate of 12% is:

A
6001
✓
6000
C
6050
D
6600

Answer

Correct option: B.

6000

(b) 6000
Explanation:
Total dividend = Face valuex no. of shares $\times$ Rate of dividend
$=\frac{50 \times 1000 \times 12}{100}$
= 6000

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MCQ 281 Mark

Dividend is declared on:

A
Market value
B
Cash value
✓
Face value
D
Fair value

Answer

Correct option: C.

Face value

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MCQ 291 Mark

Return earned by shareholder is called:

A
Interest
✓
Dividend
C
Commission
D
Brokerage

Answer

Correct option: B.

Dividend

(b) Dividend

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MCQ 301 Mark

The total capital of a company is divided into small units of equal value, is known as:

A
Fractions
B
Shares
✓
Units
D
Debentures

Answer

Correct option: C.

Units

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