Discount
 A bill is discounted at 5 % per annum. If banker’s discount be allowed, at what rate of interest must the proceeds be invested, so that nothing is lost?

 5%

4 19 % 20

5 5 % 9
 10%

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Let the sum be $ 100.
Then, B.D. = $ 5 Proceeds = $ (100  5) = $ 95
∴ $ 5 must be the interest on $ 95 for 1 year.Correct Option: C
Let the sum be $ 100.
Then, B.D. = $ 5 Proceeds = $ (100  5) = $ 95
∴ $ 5 must be the interest on $ 95 for 1 year.So, rate = 100 x 5 = 5 5 % 95 x 1 19
 A owes B $ 1350 due in 3 months and B owes A $ 1078 due 5 months. If they agrees to settle their account right now at 5 % p.a, A should pay to B :


$ 277 1 3  $ 288.25
 $ 302
 None of these


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According to question , we have
P.W. of $ 1350 = 1350 x 100 = 1350 x 400 = $ 1,333.33 100 + [ ( 3 / 12 ) x 5 ] 405
Correct Option: A
According to question , we have
P.W. of $ 1350 = 1350 x 100 = 1350 x 400 = $ 1,333.33 100 + [ ( 3 / 12 ) x 5 ] 405 P.W. of $ 1078 = 1078 x 100 = 1078 x 1200 = $ 1056 100 + [ ( 5 / 12 ) x 5 ] 1225 ∴ A should pay B = $ 4000  1056 3 A should pay B = $ 832 = $ 277 1 3 3
 The B.G. on a sum due 3 years at 10 % is $ 180. The B.D. is :

 $ 680
 $ 780
 $ 580
 $ 480

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Here , Rate = 10% , Time = 3 years , B.G. = $ 180
T.D. = B.G. x 100 = $ 180 x 100 = $ 600 R x T 10 x 3 Correct Option: B
Here , Rate = 10% , Time = 3 years , B.G. = $ 180
T.D. = B.G. x 100 = $ 180 x 100 = $ 600 R x T 10 x 3
∴ Banker 's Discount ( B.D. ) = True discount + Banker 's Gain ( B.G. )
Banker 's Discount ( B.D. ) = $ (600 + 180) = $ 780.
 The banker’s gain on a certain sum due in 2 years at 5 % per annum is $ 8. The present worth is :

 $ 800
 $ 1600
 $ 1200
 $ 880

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Given : Banker 's Gain = $ 8 , Rate = 5% , Time = 2 years
True Discount = B.G. x 100 = $ 8 x 100 Rate x Time 5 x 2
Correct Option: A
Given : Banker 's Gain = $ 8 , Rate = 5% , Time = 2 years
True Discount = B.G. x 100 = $ 8 x 100 Rate x Time 5 x 2
True Discount = $ 800
 The B.G. on a certain sum due in 5 years is 3/23 of B.D. Here, the rate of interest is :

 6%
 5%
 4%
 3%

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Let, Banker 's Discount = $ 1
∵ Banker 's Gain = $ 3 23
∴ True Discount = Banker 's Discount  Banker 's GainTrue Discount = $ 1  3 = $ 20 23 23 Correct Option: D
Let, Banker 's Discount = $ 1
∵ Banker 's Gain = $ 3 23
∴ True Discount = Banker 's Discount  Banker 's GainTrue Discount = $ 1  3 = $ 20 23 23 ∴ Sum = B.D. x T.D. B.D. T.D. Sum = 1 x 20 = $ 23 20 1  20 3 23 ∵ S.I. on $ 20 for 5 years is $ 1 3 ∴ Rate of interest = 100 x 3 = 3 % 20 x 5