Which is a better investment : `12%`, `100rs` shares at `120` or `8%` `100rs` shares at 90 ?

Answer

To determine which investment is better between `12%` `100 Rs` shares at `120` or `8%` `100 Rs` shares at `90`, we need to calculate the income generated per rupee invested for both options.

### Step-by-Step Solution

**Step 1: Calculate the dividend for the `12%` shares.**
- The face value of the shares is `100 Rs`.
- The dividend rate is `12%`.
- Dividend = \( \frac{12}{100} \times 100 = 12 \) Rs.

**Step 2: Calculate the income per rupee invested for the `12%` shares.**
- The market price of the shares is `120 Rs`.
- Income per rupee = \( \frac{\text{Dividend}}{\text{Market Price}} = \frac{12}{120} = 0.10 \) Rs.

**Step 3: Calculate the dividend for the `8%` shares.**
- The face value of the shares is `100 Rs`.
- The dividend rate is `8%`.
- Dividend = \( \frac{8}{100} \times 100 = 8 \) Rs.

**Step 4: Calculate the income per rupee invested for the `8%` shares.**
- The market price of the shares is `90 Rs`.
- Income per rupee = \( \frac{\text{Dividend}}{\text{Market Price}} = \frac{8}{90} \approx 0.0889 \) Rs.

**Step 5: Compare the income per rupee for both investments.**
- Income per rupee for `12%` shares = `0.10` Rs.
- Income per rupee for `8%` shares = `0.0889` Rs.

Since `0.10` Rs (for `12%` shares) is greater than `0.0889` Rs (for `8%` shares), we conclude that:

**Conclusion:**
The `12%` `100 Rs` shares at `120 Rs` is a better investment compared to the `8%` `100 Rs` shares at `90 Rs`.