Question: If the banker\'s discount on a sum due in 3 years is $300 at 5% per annum, what is the present worth?
Options:
$1800
$2000
$2200
$2400
Correct Answer: $2200
Solution:
Banker\'s Discount = P × R × T / 100. 300 = P × 5 × 3 / 100. P = $2000.
If the banker's discount on a sum due in 3 years is $300 at 5% per annum, what i
Practice Questions
Q1
If the banker's discount on a sum due in 3 years is $300 at 5% per annum, what is the present worth?
$1800
$2000
$2200
$2400
Questions & Step-by-Step Solutions
If the banker's discount on a sum due in 3 years is $300 at 5% per annum, what is the present worth?
Banker's Discount – The banker's discount is the interest on the face value of a sum due, calculated over a specific time period at a given interest rate.
Present Worth – The present worth is the current value of a future sum of money, discounted back to the present using a specific interest rate.
Interest Calculation – Understanding how to calculate interest using the formula: Interest = Principal × Rate × Time.
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