A bill of Rs. 12000 is discounted at 12% per annum for 9 months. What is the ban

A bill of Rs. 12000 is discounted at 12% per annum for 9 months. What is the bankers' discount?

A bill of Rs. 12000 is discounted at 12% per annum for 9 months. What is the bankers' discount?

Correct Answer: Rs. 900

Step 1: Understand that the bill amount is Rs. 12000.
Step 2: Know that the discount rate is 12% per annum.
Step 3: Convert the time period of 9 months into years. Since there are 12 months in a year, 9 months is equal to 9/12 = 0.75 years.
Step 4: Use the formula for Bankers' Discount, which is: Bankers' Discount = (Bill Amount × Rate × Time) / 100.
Step 5: Substitute the values into the formula: Bankers' Discount = (12000 × 12 × 0.75) / 100.
Step 6: Calculate the multiplication: 12000 × 12 = 144000.
Step 7: Now multiply 144000 by 0.75: 144000 × 0.75 = 108000.
Step 8: Finally, divide 108000 by 100 to find the Bankers' Discount: 108000 / 100 = 900.
Step 9: Therefore, the Bankers' Discount is Rs. 900.

Bankers' Discount – The bankers' discount is the interest on the face value of a bill for the time period until its maturity, calculated using the formula: BD = (Face Value × Rate × Time) / 100.