Question

A 6% stock yields 8%.The market value of the stock is
A. Rs 48
B. Rs 75
C. Rs 96
D. Rs 133.33

Answer 1

Hint: For solving such questions we much know the meaning of the word “yield”. Yield means to produce or provide and then you have to use the data and get the answer. Doing this will solve our question easily.

Complete step-by-step answer:
Yield refers to the income produced and released by an investment over a given period of time. It is calculated as a percentage based on the amount spent, the current market value or the security face value. It shall include interest earned or dividends obtained from the holding of a particular safe.
Here,
8% yield means that for an income of Rs 8 we need an investment of=Rs 100 (Given)
We need to calculate the yield for an income of Rs 6.
Therefore, for an income of Rs 6, we need investment,
$
   \Rightarrow \dfrac{{100}}{8} \times 6 \\
   \Rightarrow 75 \\
$
Hence the answer to this question is Rs 75.

Note: In such types of questions we need understanding words ,since the stock is yielding which means that an investment of Rs 100 is giving back an income of Rs 8.This method can be used for whatever percentage on stocks.