1on 16,87. A person applies for 200 equity shares of Rs.10 each to be issued at a premium of Rs.6 per share, Rs.8 being payable along with the application and the balance at the time of the allotment. The company may issue 100 shares or 50 shares to those who apply for 200 shares, the probability of issuing 100 shares being 0.6 and that of issuing 50 shares 0.4. In either case, the probability of an applicant being selected for the allotment of any shares is 0.2. The allotment usually takes three months and the market price per share is expected to be Rs.25 at the time of allotment. Find the expected rate of return of the investor.

1on 16,87. A person applies for 200 equity shares of Rs.10 each to be issued at a premium of Rs.6 per share, Rs.8 being payable along with the application and the balance at the time of the allotment. The company may issue 100 shares or 50 shares to those who apply for 200 shares, the probability of issuing 100 shares being 0.6 and that of issuing 50 shares 0.4. In either case, the probability of an applicant being selected for the allotment of any shares is 0.2. The allotment usually takes three months and the market price per share is expected to be Rs.25 at the time of allotment. Find the expected rate of return of the investor.

Algebra & Trigonometry with Analytic Geometry

13th Edition

ISBN:9781133382119

Author:Swokowski

Publisher:Swokowski

Chapter10: Sequences, Series, And Probability

Section: Chapter Questions

Problem 29T

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