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=> Formulas => Example Problems => Excersize Problems
1.Stock Capital :The total amount of money needed to run the company is called the stock capital.
2. Shares or Stock :
The whole capital is divided into small units, called shares or stock.
For each investment, the company issues a ‘share-certificate’, showing the value of each share and the number of shares held by a person.
The person who subscribes in shares or stock is called a share holder or stock holder.
3. Dividend :
The annual profit distributed among share holders is called dividend.
Dividend is paid annually as per share or as a percentage.
4. Face Value :
The value of a share or stock printed on the share-certificate is called its Face Value or Nominal Value or Par Value.
5. Market Value :
The stock of different companies are sold and bought in the open market through brokers at stock-exchanges. A share or stock is said to be :
At premium or Above par, if its market value is more than its face value.
At par, if its market value is the same as its face value.
At discount or Below par, if its market value is less than its face value.
6. Brokerage :
The broker’s charge is called brokerage..
I). When stock is purchased, brokerage is added to the cost price.
II). When stock is sold, brokerage is subtracted from the selling price.
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