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ABHYAS PREP: RACES, DISCOUNTS, STOCKS AND HEIGHTS · STOCKS & SHARES

Stocks: income, switching and brokerage

“x% stock at M” pays ₹x a year on every ₹100 of stock (face value), and each ₹100 of stock costs ₹M. Income = investment × x/M.

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Worked examples

Example 1 · level 1

Rohan invests ₹24,500 in 4% stock at 140 (face value ₹100). What is Rohan’s annual income from it?

  1. ₹700
  2. ₹980
  3. ₹1,372
  4. ₹17,500
Show solution
  1. Units of ₹100 stock = 24,500/140 = 175.
  2. Each unit pays ₹4, so income = 175 × 4 = ₹700.

Answer: ₹700

Example 2 · level 2

Priya holds ₹6,000 of 9% stock. Priya sells it at 80 and invests all the money received in 12% stock at 90. By how much does the annual income increase?

  1. ₹100
  2. ₹180
  3. ₹260
  4. ₹640
Show solution
  1. Old income = 9% of ₹6,000 = ₹540.
  2. Money from the sale = 6,000 × 80/100 = ₹4,800.
  3. New income = 4,800 × 12/90 = ₹640.
  4. Increase = ₹640 − ₹540 = ₹100.

Answer: ₹100

Example 3 · level 3

Lakshmi sells ₹17,200 of 15% stock at 88, paying brokerage of ₹0.5 for every ₹100 of stock sold. How much money does Lakshmi receive?

  1. ₹15,050
  2. ₹15,136
  3. ₹15,222
  4. ₹17,200
Show solution
  1. Units of ₹100 stock = 172.
  2. Each brings ₹87.5 after brokerage.
  3. Money received = 172 × 87.5 = ₹15,050.

Answer: ₹15,050

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