48. Find the amount due Jan. 16, 1881, on a note dated Jan. 8, 1879, for $3115.20, with interest payable annually at 5%, when no interest has been paid.

49. Find the amount due Jan. 18, 1881, on a note dated Jan. 8, 1877, for $2875, at 6%: (1) simple interest; (2) annual interest; (3) compound interest.

NOTE. When partial payments have been made on a note, the annual interest, by the law of Vermont, is found to the end of the first year in which any payments have been made, and the sum of the payments, with the interest reckoned on each to the end of that year, is applied to cancel any interest that may have accrued on the yearly interest, then to cancel the yearly interest, and then to the payment of the principal.

The law of New Hampshire is the same as that of Vermont; but if at the time of any payment no interest is due, except what is accruing for the year, and the payment is less than the interest due at the end of the year, then no interest is allowed on the payment.

The Connecticut Rule is similar to the United States Rule; but when less than a year's interest has accrued at the time of a payment, except it be the last payment, the difference between the amount of the principal for an entire year and the amount of the payments made that year is taken as the new principal. But if the interest which has accrued at the time of a payment exceeds the payment, no interest is computed on the payment.

These are special rules for the guidance of the State Courts or their agents, whenever it becomes necessary for them to determine the amount due on a note. But it is the general practice among business men to settle notes "with interest" that run for a year or less, by the Merchants' Rule; that run for more than a year, by the United States Rule; and to settle notes "with interest annually," or “semi-annually,” if the interest be not paid when due, by compounding the interest with the principal.

The Legislature of each State has fixed the legal rate of interest for that State. Practically, however, the rate of interest is determined by the law of supply and demand. When the supply is greater than the demand, the rate of interest is low; when the supply is less than the demand, the rate of interest is high.

CHAPTER XVIII.

STOCKS.

370. The name stock is applied to the capital of banks, railroads, and other incorporated companies.

The capital of a company is usually divided into shares, of which the original value is $100, or some other fixed sum; but the market value at any time is estimated by the current price per share.

371. When the market value of stock is equal to its original value, it is said to be at par. In quotations of stocks par is generally represented by 100; and when stock is. quoted at above 100, it is said to be at a premium; below 100, at a discount. The premium or discount is the dif ference between the quotation and 100.

Thus, when the price of a stock on a given day is 91, or, as it is commonly expressed, when the stock is at 91, the meaning is, that $100 stock costs on that day $91 money. Or that if 100 be the representative of any quantity of stock, 91 will represent the corresponding value in money. In this case the stock is said to be 9% discount.

The buying and selling of stocks is conducted through the agency of stock-brokers, who receive a brokerage on the stock. The brokerage is generally reckoned at of 1% on the par value of the stock. Thus, if a broker sells stock for a person at 91, that person receives 907; and if he buys stock for a person at 91, that person pays 911. (1) How much would be received for 52 shares of stock, $100 each, at 89?

will represent the brokerage.

891-1898, price to the seller.

Hence, 1 share will bring $893; and 52 shares, 52× $893

= $4647.50. Ans.

(2) What amount of stock at 84 may be bought for

$9393.375?

If be the brokerage,

84+84, price to the buyer.

Hence, $.84 buys $1 stock, and $9393.375 will buy

$9393.375.845 - $11,100. Ans.

=

(3) What is the quoted price of stock when $42,464.25 is paid for $46,600 stock?

If $46,600 stock cost $42,464.25,

then $1 stock costs $42,464.25÷ 46,600 $.91.

Hence, the stock is quoted at 91 – brokerage = 91. Ans.

EXERCISE LXXIII.

In the following examples the prices of stocks include brokerage unless otherwise stated:

1. Find the cost of $4000 stock, at 109%. 2. Find the cost of $2500 stock, at 98.

3. Find the cost of $3900 stock, at 781.

4. Find the cost of $4700 stock, at 1001.

5. Find the cost of $1250 stock, at 878, brokerage .

6. How much bank stock, at 751, may be bought for

$8729?

7. How much railroad stock, at 911, may be bought for

$4237-5?

8. How much railroad stock may be bought for $6305, at

1211?

9. How much railroad stock may be bought for $5137.50,

at 1022?

10. How many $100 railroad shares, at 684, may be bought

for $1650?

11. What must be the price of stock, in order that $9200 stock may be bought for $8970?

12. If $1500 stock be bought for $1374.375, what is the price of the stock?

(1) What income will be derived from $18,700 6% stock? .06 of $18,700 $1122. Ans.

(2) How much 5% stock must be bought to give an income of $360?

Since $.05 is derived from $1 stock, $360 will be derived from $360.05 = $7200. Ans.

13. What income will be derived from $29,700 4% stock? 14. Find the income from $4500 6% stock.

15. How much will a person receive from $9400 railroad stock if a dividend of 33% be declared?

16. How much 8% stock must be bought to give an income of $2400?

17. A person receives $343 as his semi-annual dividend

from a 7% stock. How much stock does he hold? 18. Find the total income of a person whose property consists of $3000 6% stocks and $8200 7% stocks. 19. Find the rate of dividend paid by some stock, when a holder of $24,600 receives $924.50.

20. Find the rate per cent at which $11,100 will yield a semi-annual return of $499.50.

Ex. If $10,250 be invested in 6% stock, at 1021, what income will be obtained?

$102 is the cost of $100 stock.

Hence, $10,250 cost of $10,250 1.025 $10,000 stock.
And .06 of $10,000 $600. Ans.

21. If $19,500 be invested in 4% stock, at 91, what income will be received?

22. Find the income on $7000 when invested in 4% stocks, at 1031.

23. What income will be derived from $6800 if it be invested in 7% stocks, at 130?

24. A person invests $7650 in railroad stock, at 63. What will he receive if a dividend of 34% be declared?

Ex. If a person buys 6% stock at 120, what rate of interest does he receive on his money invested?

$100 stock costs $120. $100 stock pays $6.
Hence, the $120 invested pays $6.

Therefore, the rate of interest is 6 ÷ 120.05 or 5%.

25. If 3% stocks are at 883, what rate per cent interest will a purchaser receive on his money?

26. If an 8% stock is at 150, what rate per cent interest will a purchaser receive on his money?

27. If a 10% stock is at 175, what rate per cent interest will an investor receive on his money?

28. If a 4% stock is at 85, what rate per cent interest will a purchaser receive on his money?

29. If a 7% stock is at 114, what rate per cent interest will a purchaser receive on his money?

30. If a 6% stock is at 130, what rate per cent interest will a purchaser receive on his money?

31. If an 8% stock is at 140, what rate per cent interest will a purchaser receive on his money?

32. How much money must be invested in 4% stock, at 92, to receive $245 income?

33. Find the sum required for an investment in a 4% stock, at 981, to produce an income of $200 a year.

34. A person bought some bank stock at 107, and received $384.25 when a dividend of 71% was paid. How much had he invested?

35. What must be the price of a 5% stock, in order that a buyer may receive 6% on his money?