Q:
      
      
         
            
Mr. Rajan invested Rs 1,00,000 in US Stock Markets when the GBPINR rate was 75. After one year his investment appreciated by 20% in GBP terms. He sold of his investments and repatriated the money to India at the then existing rate of 80. what was real returns in INR?
         
       
      
      
      
          
      
      
          Answer & Explanation
         Answer: B) gain of 28%         
         
Explanation: Money invested by Rajan before 1 year was = Rs. 100000
Money in UK pounds @ 75 is = 100000/75 = 1333.33 Pounds
 
Now, after 1 year invested amount was appreciated by 20%
=> 20% of 1333.33 = 266.66
 
Total investment becomes = 1333.33 + 266.66 = 1600 Pounds
This 1600 Pounds @ Indian currency at 80 = 1600 x 80 = Rs. 1,28,000
 
Hence, Rajan's investment of Rs. 1,00,000 becomes Rs. 1,28,000 in 1 year
 
Therefore, his profit % = [(128000 - 100000)/100000] x 100 = 28%.
       
      
      
      
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