Shares

 Shares and Dividend          Try these sums👈

What are Shares?                                          Answers of above sums👈

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  Definition: A share is a unit of ownership in a company.
  

• Example: If a company issues 1,000 shares and you own 100 of them, you own 10% of the company.

• Why Companies Issue Shares?

• To raise money for growth, expansion, or paying debts.

• Instead of taking loans, companies invite the public or investors to buy shares and invest in the business.

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• Formulae related to shares and Dividend

• Face Value (F.V.)

  • The original value of a share as stated by the company (usually ₹10 or ₹100).

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  2. Market Value (M.V.)
  

  • The price at which a share is bought or sold in the market. (usually money written after " at Rs __________)"

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  3. Number of Shares

  $$\text{Number of Shares} = \frac{\text{Investment}}{\text{Market Value of 1 share}}$$

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  4. Dividend (Annual income)

  • It is the return/profit given to shareholders on their investment.

  $$\text{Dividend} = \frac{\text{Rate of Dividend} \times \text{Face Value}}{100}$$

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  5. Total Dividend Received

  $$\text{Total Dividend} = \text{Dividend per Share} \times \text{Number of Shares}$$
  

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  6. Yield (or Return%)

  • Actual return on investment.

  $$\text{(Rate of return)Yield \%}=\left(\frac{\text{Dividend}}{\text{Market Value}}\right)\times 100$$

  7.Premium Share 

  A premium share is a share that is sold at a price higher than its face value.

• market value of 1 share = Nominal value of 1 share +  premium % of Nominal value of 1 share.

• 8.Discount Share

  A discount share is a share that is sold at a price lower than its face value.

• Market value of 1 share = N.V. of 1 share - Discount % of N.V. of 1 share.

• 9.Par Share

• When the Market Value (M.V.) of a share is equal to its Face Value (F.V.), the share is said to be at par.

• N.V of 1 share ×Rate of dividend = M.V. of  1 share × yield%