Stocks and Shares Practice Questions

5 questions per page • Detailed step-by-step solutions

Question 6
Easy
Find the income on 10% stock of Rs. 25000 purchased at Rs. 120.
A Rs. 2083.33
B Rs. 2500
C Rs. 2750
D Rs. 3000
Correct Answer: B

Explanation:

Stock of Rs. 25000 denotes the face value of the holding. Dividend rate = 10%. Annual income = 10% of Rs. 25000 = Rs. 2500.
Question 7
Medium
How much should a person invest in 5% stock at Rs. 114 to get a net income of Rs. 300 a year after paying an income tax of 5 paise in a rupee?
A Rs. 6840
B Rs. 7200
C Rs. 7410
D Rs. 7500
Correct Answer: B

Explanation:

Income tax rate = 5 paise in a rupee = 5%. Net income = 100% - 5% = 95% of gross income. Gross income required = 300 / 0.95 = 300 / (19/20) = 6000 / 19 rupees. On Rs. 100 stock, gross dividend = Rs. 5, obtained from investment of Rs. 114. Investment required = (114 / 5) * (6000 / 19) = (114 / 19) * (6000 / 5) = 6 * 1200 = Rs. 7200.
Question 8
Easy
Find the annual income derived from Rs. 2500, 8% stock at 106?
A Rs. 188.68
B Rs. 200
C Rs. 212
D Rs. 225
Correct Answer: B

Explanation:

The term 'Rs. 2500 stock' refers to stock of Face Value Rs. 2500 (not the market investment). Annual income is paid on the face value: Income = 8% of Rs. 2500 = (8/100) * 2500 = Rs. 200.
Question 9
Easy
A company declared a semiannual dividend of 7 1/2%. Find out the annual dividend of Chetan, owning 1250 shares of the company having a par value of Rs. 10 each
A Rs. 1500
B Rs. 1875
C Rs. 2000
D Rs. 2250
Correct Answer: B

Explanation:

Total par value = 1250 * 10 = Rs. 12,500. Semiannual dividend rate = 7.5% => Annual dividend rate = 7.5% * 2 = 15%. Total annual dividend = 15% of Rs. 12,500 = 0.15 * 12500 = Rs. 1875.
Question 10
Medium
A wants to secure an annual income of Rs. 1500 by investing in 15% debentures of face value of Rs. 100 each and available for Rs. 104 each. If the brokerage is 1% then the sum of money he should invest is:
A Rs. 10400
B Rs. 10504
C Rs. 10600
D Rs. 10800
Correct Answer: B

Explanation:

Each debenture pays 15% of Rs. 100 = Rs. 15. Number of debentures needed = 1500 / 15 = 100 debentures. Market price per debenture = Rs. 104. Brokerage = 1% of Rs. 104 = Rs. 1.04. Cost per debenture = 104 + 1.04 = Rs. 105.04. Total investment = 100 * 105.04 = Rs. 10,504.