2. Find the gain on 24 shares of American Woolen preferred stock bought at 87 and sold at 951, brokerage %.

3. How much is made by buying 72 shares of New York, New Haven, and Hartford R. R. stock at 1457 and selling at 150, brokerage at % ?

4. Mr. Roberts bought and sold 27 shares of Excelsior mining stock, through a broker. At the time of buying, the stock was quoted at 1173, and at the time of selling at 120ğ. Find the gain.

5. Mr. Taylor instructed his broker to buy 50 shares of Union Pacific stock at the market rate, 173. A week later Mr. Taylor instructed his broker to sell at the market rate, 170. What was Mr. Taylor's loss?

FINDING THE RATE OF INCOME

1. What per cent of income is realized from investing in stock at 75 if the annual dividend rate is 3% ?

2. Mr. Morgan buys

at a premium of 20.

a share of stock in a steel company The company pays 5% annually.

Find the rate of income on the investment.

Disregarding brokerage, find the rate of income on:

3. A 4% stock bought at 80.

4. A 5%

5. A 5%

stock bought at a premium of 20.

stock bought at a discount of 25.

6. A 31% stock bought at 121% below par. 7. A 51% stock bought at 112.

8. What is the total cost of a share of stock bought through a broker when the market price is 797? What is the rate of income on the investment if the annual dividend rate is 4% ?

stock in a packing company %; the rate of dividend paid Find the rate of income Mr.

9. Mr. Denton bought quoted at 1397, brokerage by the company was 7%. Denton received on his investment.

Reckoning brokerage at %, solve the following:

INVESTING TO SECURE A SPECIFIED INCOME

1. What sun must be invested in a stock paying an 8% dividend annually to secure an income of $1200 if the stock is purchased through a broker at 145ğ?

SOLUTION

$8 = annual income from 1 share

$1200 $8150, number of shares

$145.62 $0.121 = $145.75, cost of 1 share

$145.75 x 150 = = $21,862.50, cost of 150 shares

2. Mr. Gordon invests in 5% stock a sum sufficient to yield an annual income of $800. How much must he send to his broker if the market rate is 1071?

3. How much must be invested through a broker in a railroad stock paying semiannual 4% dividends and quoted at 147 to yield an income of $600 every six months?

GIVEN THE AMOUNT INVESTED TO FIND THE NUMBER OF SHARES

1. How many shares of stock selling at 691 can be bought for $1665, with brokerage ?

SOLUTION

$69.25 + $0.121 = $69.371, cost of 1 share

$1665 $69.375 = 24, number of shares

2. Mr. Bartlett invested, through a broker, $2862 in National Lead stock at 105. How many shares did he buy?

3. How many shares of stock at 971⁄2 can be bought for $4692 if the brokerage is % ?

4. Mr. Mixer sent his broker a check for $3991.75 to cover the purchase of New Jersey Central railroad stock quoted at 285. How many shares did he buy?

COMMON AND PREFERRED STOCK

Sometimes companies issue two kinds of stock, common and preferred. Preferred stock is stock on which a specified rate of dividend is paid before any dividend is paid on the common stock. Preferred stock can never receive a dividend greater than the amount specified, while the amount of the dividend on common stock is limited only by the profits of the company.

1. What is the capital stock of a steamship company which issues 1500 preferred and 4500 common shares of a par value of $100 each?

2. If the preferred stock of this steamship company draws 7 % dividends, and the common stock 5% dividends, how much is paid in dividends in one year?

3. A telephone company was organized with a capital of $100,000, divided into 1000 shares of a par value of $100 each. Of these 1000 shares, 300 were preferred shares on which 6% dividends were to be paid, and 700 were common shares. The company paid in dividends $4600. How much was paid on the preferred shares? How much was left for the common shares? What per cent was paid on the common shares?

4. Mr. Storer owns 28 common shares and 9 preferred 6% shares in the Parker Mfg. Co. Find the amount of his dividends in a year when the common stock pays 7%.

5. Mr. Andrews received dividends to the amount of $497 in one year on 17 preferred 7% shares and 42 common shares in the Eclipse Copper Mining Co. What was the rate of dividend on the common stock?

Find the amount paid in dividends under the following conditions:

Find the rate of dividend on the common shares under the following conditions:

National governments, states, counties, cities, towns, and corporations frequently borrow money, giving as security interest-bearing promises to pay called bonds.

Coupon bonds are bonds to which are attached interest certificates called coupons, which may be cut off and presented for payment annually, semiannually, or quarterly, as stated in the bond.

Registered bonds are registered on the books of the corporation in the name of the owner, and the interest when due is sent to the owner.

Interest on United States government bonds is payable quarterly.

Bonds are usually described by the name of the corporation issuing them, the rate of interest they bear, and the date when they become due. Thus, U. S. 2s 1930 means United States government bonds bearing 2% interest, redeemable in 1930.