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 True Discount Questions

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FACTS  AND  FORMULAE  FOR  TRUE  DISCOUNT  QUESTIONS

 

 

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) = (Sum due) - (P.W)=Rs. (156 - 100) = Rs. 56

 

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.

 

IMPORTANT FORMULAE

Let rate = R% per annum and Time = T years. Then,

1. P.W=100×Amount100+R×T=100×T.DR×T

 

2. T.D=P.W×R×T100=Amount×R×T100+R×T

 

3.  Sum=S.I×T.DS.I-T.D

 

4. (S.I) - (T.D )= S.I on T.D

5. When the sum is put at compound interest, then 

P.W=Amount1+R100T

Q:

The TrueDiscount on a certain sum of money due 3 years hence is Rs.250 and SimpeInterest on the same sum for same time and same rate is Rs375. Find sum and rate%?

A) (16 + 4/3)% B) (16 +1/3)%
C) (16 + 5/3)% D) (16 + 2/3)%
 
Answer & Explanation Answer: D) (16 + 2/3)%

Explanation:

sum = [(S.I x T.D)/(S.I-T.D)] = Rs. [(375 x 250)/(375-250)] = Rs.750 

Rate = (100 x 375)/(750 x 3) =1623 %

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0 4752
Q:

If a cellphone is purchased for Rs.490 and sold for Rs.465.50 find the loss percentage?

A) 10 B) 5
C) 20 D) 15
 
Answer & Explanation Answer: B) 5

Explanation:

loss = C.P - S.P = 490 - 465.50 =24.50 

loss % = (loss x 100)/C.P = (24.50 x 100)/490 = 5%

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4 4585
Q:

The true-discount on Rs.2480 due after a certain period at 5% is Rs.80. Find the due period.

A) 6months B) 5months
C) 8months D) 3months
 
Answer & Explanation Answer: C) 8months

Explanation:

P.W= Amount – (T.D)

 

Time = 100×TDPW×R

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Exam Prep: Bank Exams
Job Role: Bank PO

6 3758
Q:

Which is a better offer out of (i) a cash payment now of Rs.8100 or (ii) a credit of Rs.8250 after 6 months(6.5% S.I)

A) (i) B) (ii)
C) both (i) and (ii) D) none
 
Answer & Explanation Answer: A) (i)

Explanation:

PW = 100×Amount100+R×T

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8 3476
Q:

Find the present worth of a bill of Rs.28000 due 2 years at 12% compound interest. Also find the true discount.

A) 300 B) 350
C) 250 D) 275
 
Answer & Explanation Answer: A) 300

Explanation:

PW = Amount1+R100T=28001+121002   = Rs.2500 

 

TD = Amount - PW = 2800 - 2500 = Rs.300

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0 3423
Q:

The true discount on Rs.1600 due to after a certain of 5% per annum is Rs.160. The time after which it is due is

A) 27months B) 23months
C) 20months D) 12months
 
Answer & Explanation Answer: A) 27months

Explanation:

P.W. = Rs. (1600 - 160) = Rs. 1440
∴ S.I. on Rs.1440 at 5% is Rs. 160.
∴ Time = [100 * 160 / 1440 * 5] = 20/9 years = [20/9 * 12] months = 27 months.

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0 2712
Q:

A man buys a watch for Rs1950 in cash and sells it for Rs 2200 at a credit of 1 yr. The rate of interest is 10% per annum. Then he gains or loose how much amount?

A) 50 B) 55
C) 15 D) 45
 
Answer & Explanation Answer: A) 50

Explanation:

S.P = P.W of Rs. 2200 due 1yr hence = Rs. [(2200 x 100)/100+(10 x 1)] = Rs.2000 

 

Gain = Rs.(2000-1950) = Rs. 50

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0 2582
Q:

The true discount on Rs.2562 due 4 months hence is Rs.122.The rate % is?

A) 12% B) 13 (1/3)%
C) 15% D) 14%
 
Answer & Explanation Answer: A) 12%

Explanation:

P.W = Rs.( 2562 - 122) = Rs.2440 

S.I on Rs.2440 for 4 months is Rs.122 

Rate = (100 x 122)/(2440 x [1/3]) % = 15%

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