Cost of purchasing railway stock at a quoted premium Find the total cost of buying Rs. 12,600 nominal of Railway Stock quoted at 150 1/2% (i.e., price = 150.5) when dividend rate is 5 1/2% (dividend info not required for cost).

Introduction / Context:
The cost to purchase a given nominal amount of stock at a quoted percentage simply multiplies nominal by the price factor (quotation/100). Dividend rate is irrelevant to purchase cost unless yield is being computed. Here we only need the cash outlay at the premium quote.

Given Data / Assumptions:

• Nominal to buy = Rs. 12,600.
• Quoted price = 150 1/2% = 150.5 per Rs. 100 nominal.
• No brokerage or taxes are indicated.

Concept / Approach:
Cost = Nominal * (Quoted price / 100). A quote above 100 implies paying more than nominal (a premium); below 100 would be a discount.

Step-by-Step Solution:
Cost = 12,600 * 150.5 / 100.Compute factor: 150.5/100 = 1.505.Cost = 12,600 * 1.505 = Rs. 18,963.

Verification / Alternative check:
Breakdown: 12,600 * 1.5 = 18,900; plus 12,600 * 0.005 = 63; total = 18,963. Confirms accuracy.

Why Other Options Are Wrong:
Rs. 19,863 and Rs. 19,250 are high; Rs. 18,933 and Rs. 18,900 are low—none match the precise multiplication by 1.505.

Common Pitfalls:
Confusing the dividend information as relevant for cost (it is not) and mishandling mixed percentage “150 1/2%”. Always convert to a decimal multiplier carefully.

Final Answer:
Rs. 18,963