A bill of Rs. 8000 is discounted at 15% per annum for 3 months. What is the bank

A bill of Rs. 8000 is discounted at 15% per annum for 3 months. What is the bankers' discount?

A bill of Rs. 8000 is discounted at 15% per annum for 3 months. What is the bankers' discount?

Correct Answer: Rs. 300

Step 1: Identify the total bill amount, which is Rs. 8000.
Step 2: Identify the discount rate, which is 15% per annum.
Step 3: Identify the time period for the discount, which is 3 months.
Step 4: Convert the time period from months to years. Since there are 12 months in a year, 3 months is equal to 3/12 years.
Step 5: Calculate the Bankers' Discount using the formula: Bankers' Discount = (Bill Amount × Discount Rate × Time Period in Years) / 100.
Step 6: Substitute the values into the formula: Bankers' Discount = (8000 × 15 × 3/12) / 100.
Step 7: Simplify the calculation: First, calculate 3/12 which equals 0.25. Then, multiply 8000 by 15 to get 120000.
Step 8: Now, multiply 120000 by 0.25 to get 30000.
Step 9: Finally, divide 30000 by 100 to get Rs. 300.

Bankers' Discount – The bankers' discount is the interest calculated on the face value of a bill for the time period until its maturity, using the nominal interest rate.
Time Period Calculation – Understanding how to convert months into years for the interest calculation is crucial.
Percentage Calculation – Applying the percentage formula correctly to find the discount amount.