Investing Rs. 1552 in a stock at 97 yields an income of Rs. 128. What is the dividend rate of the stock__________?
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Answer: B. 8%
Explanation
Investing fifteen fifty two in a stock priced at ninety seven gives a nominal stock face value of sixteen hundred. An annual income of one hundred twenty eight earned on a sixteen hundred nominal value represents the return. Dividing the income by the nominal stock value and multiplying by one hundred calculates an eight percent dividend rate. Stock dividend rates express annual income earned as a percentage of the nominal face value of the shares. Market investment outlays relate to nominal face values through the prevailing stock market quotation price. Calculating dividend yield requires isolating nominal stock capital before determining percentage returns.
Option A underestimates the dividend rate by miscalculating the nominal stock face value proportion. Option C represents an incorrect rate that fails to match the income and nominal value calculation. Option D is incorrect because a valid and calculable dividend rate of eight percent exists.
- Subject
- Mathematics
- Category
- Mathematics
- Topic
- —
- Difficulty
- medium
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