Which is better investment : 6% Rs 100 shares at Rs 120 or 8% Rs 10 shares at Rs 15 ?
Answer & explanation
Correct answer: option 2
The correct answer is option (2) : 8% ₹10 shares at ₹15 is better investment
In 1st case :
Income on ₹120 = 6% of ₹ 100
$= ₹ 6$
∴ Income on $₹1 =₹\frac{6}{120}= ₹1.050$
In second case :
Income on ₹15= 8% of ₹ 10
$=₹0.80$
∴ Income on $₹ 1=₹ \frac{0.80}{15}$
$=₹ 0.053$
$∵ 0.053 > 0.050 $
Hence 8% ₹10 shares at ₹15 is better investment