A 9% stock yields 8%. The market value of the stock is__________?
Correct answer: D. Rs. 112.50
- A. Rs. 72
- B. Rs. 116.50
- C. Rs. 90
- D. Rs. 112.50
Explanation
A 9% stock yielding 8% has market price P satisfying 9/P = 8/100. Therefore P = (9 x Rs. 100) ÷ 8 = Rs. 112.50 per Rs. 100 stock. The likely trap is option c, Rs. 90, which treats the yield as a discount instead of calculating the price from the return.
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About Percentages
Percentages express a quantity as parts per hundred and support calculations involving increases, decreases, discounts, commissions, taxes, and successive changes. Questions require distinguishing percentage change from percentage points and identifying the original value when a final value and its percentage change are given.
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