Find the Banker's Discount on a sum of $2000 due in 1 year at a rate of 10%.
Practice Questions
Q1
Find the Banker's Discount on a sum of $2000 due in 1 year at a rate of 10%.
$200
$150
$100
$250
Questions & Step-by-Step Solutions
Find the Banker's Discount on a sum of $2000 due in 1 year at a rate of 10%.
Correct Answer: $200
Step 1: Identify the principal amount, which is $2000.
Step 2: Identify the rate of interest, which is 10%.
Step 3: Identify the time period, which is 1 year.
Step 4: Use the formula for Banker's Discount: Banker's Discount = (Principal x Rate x Time) / 100.
Step 5: Substitute the values into the formula: Banker's Discount = (2000 x 10 x 1) / 100.
Step 6: Calculate the result: 2000 x 10 = 20000, then 20000 / 100 = 200.
Step 7: Conclude that the Banker's Discount is $200.
Banker's Discount – The Banker's Discount is the interest deducted in advance on a loan or sum due, calculated based on the principal amount, the rate of interest, and the time period until the amount is due.
