Question

A man invested ksh. 36000 in two companies P and Q . Company P pays a dividend of 11.25% while Q pays a dividend of 10.5%. Is from his total investment, he obtained a return of 10.75%,how much did he invest in each company?​

Answer 1

Amount invested in P = 12,000

Amount invested in Q = 24,000

Explanation:

Given:

Amount invested = 36,000 in two companies P and Q

P pays dividend = 11.25%

Q pays dividend = 10.5%

Total return = 10.75%

Find:

Amount invested in each company

Computation:

Total return = 36,000 x 10.75

Total return = 3870

Assume;

Amount invested in P = a

So,

Return in P = a x 11.25%

Return in P = 0.1125a

Return in Q = [36000 - a]10.5%

Return in Q = 3,780 - 0.105a

Total return = Return in P + Return in Q

3,870 = 0.1125a + 3,780 - 0.105a

90 = 0.0075a

a = 12,000

Amount invested in P = 12,000

Amount invested in Q = 36,000 - 12,000

Amount invested in Q = 24,000

Answer 2

Investment in company P = 12,000

Investment in company Q = 24,000

Explanation:

Given that,

Total investment = 36,000

Dividend paid by company P = 11.25%

Dividend paid by company Q = 10.5%

Total return = 10.75%

Now, let investment made in company P be 'a' and company 'Q' be 'b.' So,

A.T.Q.

a + b = 36,000 ...(i)

11.25% of a + 10.5% of b = 10.75% of 36000 ...(ii)

On simplification,

a + b = 36,000

11.25% of a + 10.5% of b = 3870

Now,

11.25% of a + 10.5% of (36000 - a) = 3870

⇒ 0.1125 * a + 0.105 * (36000 - a) = 3870

⇒ 0.1125 a + 3780 - 0.105a = 3870

⇒ 0.1125a - 0.105 a - 3870 - 3780

⇒ 0.0075 a = 90

⇒ a = 90/0.0075

∵ a = 12000

Since, a = P = 12,000

Q = b = (36000 - a)

= 36000 - 12000

= 24,000

Thus,

Investment in company P = 12,000

Investment in company Q = 24,000