NISM Certifications · NISM-Series-XXI-A: Portfolio Management Services (PMS) Distributors · Investing in Stocks (NISM XXI-A)
A stock with a face value of Rs 10 is trading at Rs 250 and has paid a dividend of 50% during the year. What is its dividend yield?
The dividend yield is 2%. A 50% dividend on a Rs 10 face value equals Rs 5 per share, and dividing by the market price of Rs 250 gives 2%. Dividend percentages are always applied to face value, not market price.
- A2.0%Correct
- B5.0%
- C0.2%
- D20.0%
Explanation
Dividend of 50% on face value Rs 10 is Rs 5 per share. Dividend yield = 5/250 = 2%. Treating 50% as the yield gives a wrong answer, and using face value as the base gives 50%.
Did you get it right without looking?
One question tells you little. A timed set on Investing in Stocks (NISM XXI-A) shows your real accuracy, how long you take and where you lose marks.
More Investing in Stocks (NISM XXI-A) questions
- A company's shares are quoted at ₹480 and its earnings per share for the last year were ₹32. What is its price-to-earnings (P/E) ratio?
- A company with 10 crore shares outstanding has a net profit of ₹150 crore and pays out ₹60 crore as dividend. If the share trades at ₹300, w…
- A company with 10 crore shares outstanding has a net profit of ₹150 crore, and pays total dividends of ₹45 crore. What is its dividend payou…
- A company announces a bonus issue in the ratio 1:2 (one bonus share for every two held) and the cum-bonus price is ₹360. Ignoring other fact…
- A stock trades at a price of Rs 450 and its book value per share is Rs 150. What is its price-to-book value ratio?
- A company declares a dividend of Rs 6 per share. The stock's current market price is Rs 240. What is its dividend yield?