A company declared a dividend of 14%. Find the market value of ₹50 shares, if the return on the investment was 10%
Answer & explanation
Correct answer: option 4
The correct answer is option (4) : ₹70
Let the MV of 1 share of ₹ 50 be ₹x
Given rate of division = 14% so rate of return = 10%
Dividend on 1 share of ₹ 50 = 14% of ₹ 50 = ₹7
$∴10=\frac{7}{x}×100$
$x= 70$
Hence MV of ₹ 50 share = ₹70