smc-817-40-Shares/Dividends

Financial Maths, STD2 F4 2025 HSC 23

Company $\text{A}$ and Company $\text{B}$ both issue an annual dividend per share as shown in the table.

\begin{array} {|c|c|c|}
\hline
\rule{0pt}{2.5ex} {Company} \rule[-1ex]{0pt}{0pt} & {Current \ share \ price} \rule[-1ex]{0pt}{0pt} & \substack{\textstyle\textit{Annual dividend} \\ \textstyle\textit{per share}}\\
\hline
\rule{0pt}{2.5ex} \text{A} \rule[-1ex]{0pt}{0pt} & \text{\$25.43} \rule[-1ex]{0pt}{0pt} & \text{\$4.92}\\
\hline
\rule{0pt}{2.5ex} \text{B} \rule[-1ex]{0pt}{0pt} & \text{\$2.13} \rule[-1ex]{0pt}{0pt} & \text{45c}\\
\hline
\end{array}

Based on the dividend yield, which company would be better to invest in? (2 marks)

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$\text{Div yield (A)} =\dfrac{4.92}{25.43}=0.1934 = 19.3\% $

$\text{Div yield (B)} =\dfrac{0.45}{2.13}=0.211 = 21.1\% $

$\text{Since Div yield (B) > Div yield (A), it is better to invest in company B.}$

Show Worked Solution

$\text{Div yield (A)} =\dfrac{4.92}{25.43}=0.1934 = 19.3\% $

$\text{Div yield (B)} =\dfrac{0.45}{2.13}=0.211 = 21.1\% $

$\text{Since Div yield (B) > Div yield (A), it is better to invest in company B.}$

Financial Maths, STD2 F4 2013 HSC 28d (Adapted)

James has 3000 shares. The current share price is $2.50 per share. James is paid a dividend of $0.50 per share.

What is the current value of his shares? (1 mark)

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Calculate the dividend yield. (1 mark)

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a. `$7500`

b. `text(20%)`

Show Worked Solution

a.	`text(# Shares)=3000`
	`text(Share price) = $2.50`

`:.\ text(Current value)`	`= 3000x 2.50`
	`=$7500`

♦♦♦ Mean mark 13%
MARKER’S COMMENT: A large majority of students had a poor understanding of the term dividend yield.

b.	`text(Dividend yield)`	`=\ text(Dividend)/text(Share price)`
		`= 0.50/2.50`
		`=20 text(%)`

Financial Maths, STD2 F4 2021 HSC 30 (Adapted)

Dianne owns 1600 shares in a company. The market price for each share is $30. Dianne's total dividend from these shares is $768.

Calculate the dividend yield for her shares. (2 marks)

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`1.6 text(%)`

Show Worked Solution

♦ Mean mark 47%.

`text(Dividend yield)`	`= text(Dividend)/text(Value of shares)`
	`= 768/(1600xx 30)`
	`=0.016`
	`= 1.6 text(% yield)`

Financial Maths, STD2 F4 2005 HSC 13 MC (Adapted)

Two years ago, Jordan bought 200 shares at $3.00 per share. They are now worth $3.75 per share. Jordan receives a dividend of $0.15 per share.

What is the dividend yield?

`text(3.75%)`
`text(4%)`
`text(4.5%)`
`$30`

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`B`

Show Worked Solution

`text(Dividend yield)`	`= text(Dividend)/text(Share Value)`
	`= 0.15/3.75`
	`= 0.04`
	`= 4 text(%)`

`=> B`

Financial Maths, STD2 F4 2022 HSC 10 MC

Alex purchased 800 shares. The total cost was $2.60 per share. Alex sold the shares one year later for $3.40 each and paid a fee of $24.95 for selling the shares.

What profit did Alex make on these shares?

$590.10
$615.05
$640.00
$664.95

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`B`

Show Worked Solution

`text{C}text{ost of shares}\ = 800 xx 2.60=$2080`

`text{Sale funds}`	`=\ text{sale price}\ -\ text{fee}`
	`=(800 xx 3.40)-24.95=$2695.05`

`text{Profit}`	`=\ text{Sale funds}\ -\ text{C}text{ost}`
	`=2695.05-2080= $615.05`

`=>B`

Financial Maths, STD2 F4 2021 HSC 30

Ariana owns 1500 shares in a company. The market price for each share is $27. Ariana's total dividend from these shares is $810.

Calculate the dividend yield for her shares. (2 marks)

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`2text(%)`

Show Worked Solution

♦ Mean mark 47%.

`text(Dividend yield)`	`= text(Dividend)/text(Value of shares)`
	`= 810/(1500 xx 27)`
	`=0.02= 2\%\ text(yield)`

Financial Maths, STD2 F4 2020 HSC 29

Jana owns a share portfolio. Details of her share portfolio at 30 June 2020 are given in the table.

Jana received a total annual dividend of $149.52 from her share portfolio.

Calculate the number of shares Jana has in company `XYZ` on 30 June 2020. (3 marks)

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`348`

Show Worked Solution

`ABC \ text{Dividend}`	`= text{Value of shares} xx text{dividend yield}`
	`= (200 xx 5.5) xx 0.06= $66.00`

♦ Mean mark 43%.

`XYZ \ text{Dividend}= 149.52-66.00= $83.52`

`text{Let} \ \ x = text{number of} \ XYZ \ text{shares}`

`83.52`	`= text{Value of} \ XYZ \ text{shares} xx text{dividend yield}`
`83.52`	`= (x xx 6.0) xx 0.04`
`6x`	`= frac{83.52}{0.04}`
`x`	`= frac{2088}{6}= 348`

`therefore \ text(Jana has )348\ XYZ\ text(shares on 30 June)\ 2020`

Financial Maths, STD2 F4 2019 HSC 21

A person owns 1526 shares with a market value of $8.75 per share. The total dividend received for these shares is $1068.20.

Calculate the percentage dividend yield. (2 marks)

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`8text(%)`

Show Worked Solution

`text(Value of shares)= 1526 xx 8.75= $13\ 352.50`

`:.\ text(Dividend yield)= 1068.20/(13\ 352.50)= 0.08= 8text(%)`

Financial Maths, STD2 F4 EQ-Bank 30

An investment fund purchases 4500 shares of Bank ABC for a total cost of $274 500 (ignore any transaction costs).

The investment fund is paid a divided of $3.66 per share in the first year.

What was the purchase price of 1 share? (1 mark)

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Calculate the divided yield. (1 mark)

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a. `$61`

b. `6\%`

Show Worked Solution

a. `text(Price per share) = (274\ 500)/4500 = $61`

b. `text(Dividend Yield)`

`= text(Dividend)/text(Share Price) xx 100`

`= 3.66/61 xx 100= 6\%`

Financial Maths, STD2 F4 2017 HSC 26e

Sam purchased 500 company shares at $3.20 per share. Brokerage fees were 1.5% of the purchase price.

Sam is paid a dividend of 26 cents per share, then immediately sells the shares for $4.80 each.

If he pays no further brokerage fees, what is Sam’s total profit? (3 marks)

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`$906`

Show Worked Solution

`text(Purchase price)= 500 xx 3.20= $1600`

`text(Brokerage fees)= 1.5text(%) xx 1600= $24`

`text(Dividends)= 500 xx 0.26= $130`

`text(Sale price)= 500 xx 4.80= $2400`

`:.\ text(Total profit)= 2400 + 130-(1600 + 24)= $906`

Financial Maths, STD2 F4 2005 HSC 13 MC

Last year, Helen bought 150 shares at $2.00 per share. They are now worth $2.50 per share. Helen receives a dividend of $0.10 per share.

What is the dividend yield?

`text(4%)`
`text(20%)`
`$15`
`$75`

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`A`

Show Worked Solution

`text(Dividend yield)`	`= text(Dividend)/text(Share Value)`
	`= 0.10/2.50`
	`= 0.04`
	`=\ text(4%)`

`=> A`

Financial Maths, STD2 F4 2013 HSC 28d

Adhele has 2000 shares. The current share price is $1.50 per share. Adhele is paid a dividend of $0.30 per share.

What is the current value of her shares? (1 mark)
Calculate the dividend yield. (1 mark)

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a. `$3000`

b. `text(20%)`

Show Worked Solution

a. `text(# Shares)=2000`

`text(Share price) = $1.50`

`:.\ text(Current value)= 2000 xx 1.50=$3000`

♦♦♦ Mean mark (b) 13%

MARKER’S COMMENT: A large majority of students had a poor understanding of the term dividend yield.

b.	`text(Dividend yield)`	`=\ text(Dividend)/text(Share price)`
		`= 0.30/1.50=20\%`