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The true discount on a bill of Rs. 2160 is Rs. 360. What is the banker's discount?
Answer & Solution
Correct Answer:
Option
A
F = Rs. 2160
TD = Rs. 360
PW = F - TD = 2160 - 360 = Rs. 1800
True Discount is the Simple Interest on the present value for unexpired time
⇒ Simple Interest on Rs. 1800 for unexpired time = Rs. 360
Banker's Discount is the Simple Interest on the face value of the bill for unexpired time
= Simple Interest on Rs. 2160 for unexpired time
$$\eqalign{ & = \frac{{360}}{{1800}} \times 2160 \cr & = \frac{1}{5} \times 2160 \cr & = {\text{Rs}}{\text{.}}\,432 \cr} $$
TD = Rs. 360
PW = F - TD = 2160 - 360 = Rs. 1800
True Discount is the Simple Interest on the present value for unexpired time
⇒ Simple Interest on Rs. 1800 for unexpired time = Rs. 360
Banker's Discount is the Simple Interest on the face value of the bill for unexpired time
= Simple Interest on Rs. 2160 for unexpired time
$$\eqalign{ & = \frac{{360}}{{1800}} \times 2160 \cr & = \frac{1}{5} \times 2160 \cr & = {\text{Rs}}{\text{.}}\,432 \cr} $$
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