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Quantitative Aptitude Questions for True Discount with Answers
 
 
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True Discount (375 Views)
 
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Suppose a man has to pay Rs.156 after 4 years and the rate of interest is 14% per annum.

Clearly, Rs. 100 at 14% will amount to Rs. 156 in 4 years, So, the payment of Rs. 100 now will clear off the debt of Rs. 156 due 4 years hence. We say that:

Sum due= Rs. 156 due 4 years hence;

Present Worth (P.W) = Rs. 100;

True Discount (T.D) = Rs. (156-100)= Rs. 56 = (Sum due)- (P.W).

We define: T.D=Interest on P.W.

Amount= (P.W) + (T.D).

Interest is reckoned on P.W and true discount is reckoned on the amount.

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