Stocks and Shares Questions

Practice Stocks and Shares MCQs with answers and explanations. Page 4 of 6.

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Stocks and Shares
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Questions

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Dividend income and rate on investment with brokerage per share Find the annual income and the rate of interest on the investment from 44 shares of Rs. 25 face value each, bought at Rs. 5 premium (market Rs. 30) with brokerage Rs. 0.25 per share, when the dividend rate is 5%.
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Dividend computation from number of shares and face value A company declared an annual dividend of 10%. What annual dividend does Anu receive if she owns 4000 shares of face value $100 each?
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Dividend income from number of $100 shares Jatin invested $27260 in $100 shares at a market price of $116 each. The company pays a 16% dividend. What is his annual dividend income?
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Income on 12% stock from a given nominal holding Find the annual income on 12% stock if the nominal holding is $60,000 (shares purchased at $110, but price is irrelevant for the dividend).
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Investment required for a target income with brokerage What investment is required to obtain an income of $1938 from 9.5% stock quoted at 90, if brokerage on purchase is 1%?
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Company profit distribution – Reserve after paying declared dividends A company has issued 10,000 preferred shares and 50,000 common shares, both of par value $100 each. Dividends are 12% on each preferred share and 17.6% on each common share. The total profit is $15 million. After paying these dividends, how much is kept in the reserve fund?
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Share purchase cost and subsequent gain on sale at premium 12,500 shares of par value $20 each are purchased at $25 per share. Later, they are sold at a premium of $11 per share (i.e., at $31). What is the purchase amount, and what is the seller’s gain?
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Income from a premium purchase – nominal inferred from investment Find the annual income by investing $81,000 in 9% stock quoted at 135.
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Investment required to buy a given nominal of stock at premium What cash investment is required to purchase $90,000 nominal of 8% stock quoted at 110?
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Cost to buy shares at premium and gain on later sale Shares of par value $10 each are available at a 20% premium. A buyer purchases 2500 shares. How much does the buyer pay, and what is the gain if he later sells those shares at $20 per share?
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Market value for a target yield from a fixed dividend Mac buys 200 shares of par value $10 each. The company pays an annual dividend of 8%. At what market price per share should he buy if he wants a 10% return on his investment?
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Stocks and shares — combined dividends: Sunil holds 200 preferred shares and 1000 common (ordinary) shares, each with a par value of $100. The company declares a dividend of 10% per annum on preferred shares and 12 1/2% per annum on common shares. Calculate the total annual dividend income received by Sunil from both types of shares.
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Dividend rate from totals: A company has 50,000 shares of par value $10 each. If the total annual dividend distributed is $62,500, determine the percentage rate of dividend paid on the share capital.
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Compute dividend rate from totals: A pharmaceutical company has issued 125,000 shares of par value $20 each. If the total annual dividend declared is $375,000, what is the percentage dividend rate paid by the company?
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Preferred vs. common dividend split: A company has 50,000 preferred shares (dividend at 20%) and 20,000 common shares; each share has par value $10. The company earns $180,000 profit, keeps $30,000 in reserves, and distributes the remainder as dividends. What is the dividend percentage paid to common shareholders?
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Income from fixed-interest stock: Find the annual income from 7 1/2% stock on a nominal (par) holding of $20,000 if the stock was purchased at $120. Assume the quoted price does not alter the coupon income.
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Dividend rate after reserve transfer: A company has 50,000 shares of par value $100 each. It declares a total of $125,000, but transfers $50,000 to the reserve fund and distributes the remainder as dividend. What percentage dividend is paid to shareholders?
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Income from stock purchased above par: Find the annual income by investing $81,000 in 9% stock quoted at 135 (i.e., $135 per $100 nominal). Assume coupon is on nominal value.
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Market value for a target yield: A company pays a 15% annual dividend on shares of par $10. Shyam wants a 10% return on her investment. At what market price per share should she buy (so that dividend yield is 10%)?
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Reinvesting sale proceeds across companies: A man sells 5,000 common shares of Company X (par $10, dividend 20%) at $30 each. He reinvests all proceeds in ordinary shares of Company Y (par $25, dividend 15%) priced at $40 per share. How many shares of Company Y does he purchase?
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