Banker’s Discount

Question:
discount. The rate percent is:
[A].

5	1	%
	5

[B].

9	1	%
	11

[C].

8	1	%
	8

[D].

6	1	%
	6

Answer: Option B

Explanation:

Let, B.D = Re. 1.

Then, B.G. = Re.	3	.
	25

T.D. = (B.D. – B.G.) = Re.		1 –	3		= Re.	22	.
			25			25

Sum =		1 x (22/25)		= Rs.	22	.
		1-(22/25)			3

S.I. on Rs.	22	for 1	1	years is Re. 1.
	3		2

Rate =		100 x 1	%	= 100 = 9 1 %. 11 11
		22 x 3 3 2

Question:

The rate percent is:
[A].

11%

[B].

10%

[C].

5%

[D].

5.5%

Answer: Option C

Explanation:

Let T.D. be Re. 1.

Then, B.D. = Rs.	11	= Rs. 1.10.
	10

Sum = Rs.		1.10 x 1		= Rs.		110		= Rs. 11.
		1.10 – 1				10

S.I. on Rs. 11 for 2 years is Rs. 1.10

Rate =		100 x 1.10	%	= 5%.
		11 x 2

Question:
The banker’s discount of a certain sum of money is Rs. 72 and the true discount on the same sum for the same time is Rs. 60. The sum due is:

[A].

Rs. 360

[B].

Rs. 432

[C].

Rs. 540

[D].

Rs. 1080

Answer: Option A

Explanation:

Sum =	B.D. x T.D.	= Rs.		72 x 60		= Rs.		72 x 60		= Rs. 360.
	B.D. – T.D.			72 – 60				12

Question:
The banker’s discount on a sum of money for 1 years is Rs. 558 and the true discount on the same sum for 2 years is Rs. 600. The rate percent is:

[A].

10%

[B].

13%

[C].

12%

[D].

15%

Answer: Option C

Explanation:

B.D. for years	= Rs. 558.
B.D. for 2 years	= Rs. 558 x 2 x 2 3
	= Rs. 744

T.D. for 2 years = Rs. 600.

Sum =	B.D. x T.D.	= Rs.		744 x 600		= Rs. 3100.
	B.D. – T.D			144

Thus, Rs. 744 is S.I. on Rs. 3100 for 2 years.

Rate =		100 x 744	%	= 12%
		3100 x 2

Question:
The banker’s discount on Rs. 1600 at 15% per annum is the same as true discount on Rs. 1680 for the same time and at the same rate. The time is:

[A].

3 months

[B].

4 months

[C].

6 months

[D].

8 months

Answer: Option B

Explanation:

S.I. on Rs. 1600 = T.D. on Rs. 1680.

Rs. 1600 is the P.W. of Rs. 1680, i.e., Rs. 80 is on Rs. 1600 at 15%.

Time =		100 x 80	year	=	1	year = 4 months.
		1600 x 15			3

Question:
The present worth of a sum due sometime hence is Rs. 576 and the banker’s gain is Rs. 16. The true discount is:

[A].

Rs. 36

[B].

Rs. 72

[C].

Rs. 48

[D].

Rs. 96

Answer: Option D

Explanation:

T.D. = P.W. x B.G. = 576 x 16 = 96.

Question:
The banker’s gain on a sum due 3 years hence at 12% per annum is Rs. 270. The banker’s discount is:

[A].

Rs. 960

[B].

Rs. 840

[C].

Rs. 1020

[D].

Rs. 760

Answer: Option C

Explanation:

T.D. =		B.G. x 100		= Rs.		270 x 100		= Rs. 750.
		R x T				12 x 3

B.D. = Rs.(750 + 270) = Rs. 1020.

Question:
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

Answer: Option A

Explanation:

T.D.	= B.D. x 100 100 + (R x T)
	= Rs. 420 x 100 100 + 15 x 1 3
	= Rs. 420 x 100 105
	= Rs. 400.

Question:
The banker’s gain on a bill due 1 year hence at 12% per annum is Rs. 6. The true discount is:

[A].

Rs. 72

[B].

Rs. 36

[C].

Rs. 54

[D].

Rs. 50

Answer: Option D

Explanation:

T.D. =	B.G. x 100	= Rs.		6 x 100		= Rs. 50.
	R x T			12 x 1

Question:
The banker’s gain of a certain sum due 2 years hence at 10% per annum is Rs. 24. The present worth is:

[A].

Rs. 480

[B].

Rs. 520

[C].

Rs. 600

[D].

Rs. 960

Answer: Option C

Explanation:

T.D. =		B.G. x 100		= Rs.		24 x 100		= Rs. 120.
		Rate x Time				10 x 2

P.W. =	100 x T.D.	= Rs.		100 x 120		= Rs. 600.
	Rate x Time			10 x 2