The true discount on a bill of $ 5450 due in 9 months is

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The true discount on a bill of $ 5450 due in 9 months is $ 450. Find the rate of interest.

1. 12%
2. 12.5%
3. 11.5%
4. 13.1%

Correct Option: A

Here , Amount = $ 5450
Present worth ( P.W. ) = Amount - True Discount
Present worth ( P.W. ) = $ 5450 - $ 450 = $ 5000
In other words, simple interest on $ 5000 for 9 months is $ 450

∴ Rate =	Simple Interest x 100	=	450 x 100 x 4
	P x T		5000 x 3

Rate = 12% per annum.