Find the annual income obtained by investing Rs 6800 in 10 percent stock that is quoted at Rs 136 per Rs 100 nominal share.

Introduction / Context: This question combines the idea of investment at a quoted market price with calculation of annual dividend income from a percentage stock. Although the investor is told how much money is invested and at what price the stock is quoted, the dividend itself is always computed on the nominal value of the shares, not on the amount invested. Given Data / Assumptions:

• Total money invested = Rs 6800
• Market price of Rs 100 nominal stock = Rs 136
• Dividend rate on nominal value = 10 percent per year
• We must find the annual income (dividend) from this investment

Concept / Approach: First step is to convert the investment and market price into nominal value of stock purchased. If a Rs 100 nominal share costs Rs 136, each rupee of nominal value costs 136 / 100 rupees. Once we know the total nominal value, we apply: Annual dividend = Nominal value * Dividend rate / 100. Step-by-Step Solution: Step 1: Market price of Rs 100 nominal stock = Rs 136. Step 2: Let N be the total nominal value purchased. Then 6800 = N * 136 / 100. Step 3: Rearranging, N = 6800 * 100 / 136. Step 4: N = 6800 / 136 * 100 = 50 * 100 = Rs 5000 nominal value. Step 5: Dividend rate = 10 percent, so annual income = 5000 * 10 / 100 = Rs 500. Verification / Alternative check: Check in a more intuitive way. Price per Rs 100 nominal is 136. Investment 6800 divided by 136 gives the number of Rs 100 shares: 6800 / 136 = 50 shares of Rs 100 nominal each. So nominal value = 50 * 100 = 5000. Dividend at 10 percent is Rs 10 per share, hence 50 * 10 = Rs 500, confirming the previous calculation. Why Other Options Are Wrong:

• Rs 250: Corresponds to a 5 percent dividend on Rs 5000 nominal value.
• Rs 1500: Too large; this would imply a 30 percent dividend rate, which is not given.
• Rs 50: Too low; this would represent only 1 percent on Rs 5000 nominal value.

Common Pitfalls:

• Using the investment 6800 directly with the 10 percent rate instead of converting to nominal value.
• Incorrectly computing the nominal value by dividing by 1.36 instead of 136 / 100.
• Forgetting the 100 factor when moving between per rupee and per Rs 100 nominal values.

Final Answer: The annual income derived from the investment is Rs 500.