What is the present worth of a bill of Rs. 1764 due 2 years hence at 5% compound interest is
A. Rs. 1600
B. Rs. 1200
C. Rs. 1800
D. Rs. 1400
Answer: Option A
Solution(By Examveda Team)
Since the compound interest is taken here,$$\eqalign{ & PW{\text{ }}{\left( {1 + \frac{5}{{100}}} \right)^2} = 1764 \cr & PW\,{\left( {1 + \frac{1}{{20}}} \right)^2} = 1764 \cr & PW\,{\left( {\frac{{21}}{{20}}} \right)^2} = 1764 \cr & PW \times \frac{{441}}{{400}} = 1764 \cr & \Rightarrow PW = \frac{{1764 \times 400}}{{441}} \cr & \,\,\,\,\,\,\,\,\,\,\,\,\,\,\,\,\,\,\, = 4 \times 400 \cr & \,\,\,\,\,\,\,\,\,\,\,\,\,\,\,\,\,\,\, = {\text{Rs}}{\text{.}}\,1600 \cr} $$
Related Questions on Bankers Discount
The banker's discount on a bill due 4 months hence at 15% is Rs. 420. The true discount is:
A. Rs. 400
B. Rs. 360
C. Rs. 480
D. Rs. 320
A. 3 months
B. 4 months
C. 6 months
D. 8 months
A. Rs. 480
B. Rs. 520
C. Rs. 600
D. Rs. 960
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