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What is the rate of interest when the P.W. of $ 1245 due in 15 months is $ 1200?
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- 3%
- 4%
- 6%
- 5%
Correct Option: A
Given :- Amount = $ 1245 , Present Worth = $ 1200
∴ True Discount = Amount - Present Worth
True Discount = $ 1245 - $ 1200 = $ 45
Present Worth ( P.W. ) = $ 1200
| ∴ Rate of interest = | True Discount × 100 | % |
| Present Worth × Time |
| Rate of interest = | 45 x 100 | = 3 % |
| 1200 x 15/12 |
