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Banker's Discount

Introduction Bill amount (A) x Rate (R) x Unexpired Time (T)

As discussed in the chapter of "True Discount", i f 100
the borrower returns the loan before the due date, he has to (ii) Banker's Gain (BG) = Simple interest on True Dis-
pay slightly less money than the amount due. This less money T.DxRxT
is the benefit given to the borrower for earlier repayment and count(TD)= 1 Q ( )

is known as True Discount. In fact true discount is the "in- = Banker's Discount (B.D) - True Discount (TD.)
terest calculated on the Present Worth of the Due Amount (iif) True Discount ( T D . ) = Bill Amount (A) - Present
for due periodfrom right new ". Worth (PW)
But, suppose the debtor (who has taken the loan) is = Simple Interest on Present Worth (PW)
not able to clear the loan before it is due, but the creditor PWxRxT
(who has given the loan) requires money, he has no right to
100
ask the debtor to pay back before the bill is due. The only
way the creditor can raise money is to go to a bank and Rule 1
encash the bill. During encashment of the bill, the bank will To find the Banker's Discount when Bill Amount (A), Time
charge a simple interest on the amount mentioned in the bill (T) and Rate (R) are given.
for the unexpired time.
AxRxT
Now look at some important terms that are frequently Banker's Discount =
used in this chapter. 100
1. Face value:
Illustrative Example
The amount mentioned in the bill is called face value.
EK Find the banker's discount on a bill of Rs 2550 due 4
2. Banker's Discount: (B.D.)
months hence and 6% per annum.
It is the simple interest on the amount mentioned in
Soln: Applying the above formula, we have
the bill (or face value) for the period from the date on which
2550x6x4
the bill was encashed and the legally due date. Banker's Discount = ... = Rs 51
"Banker's Discount is slightly more than True Dis- 100x12
count ' Exercise
3. Banker's Gain (B.G.): 1. The true discount on a bill of Rs 1860 due after 8 months
The difference between Banker's Discount (B.D) and is Rs 60. Find the banker's discount.
True Discount (TD) is known as Banker's Gain. a)Rs62 b)Rs52 c)Rs60 d) None of these
Note: 1. Banker's Discount, True Discount and Banker's Gain 2. Find the banker's discount on a bill of Rs 12750 due 2
are on the unexpired (unutilised) time of the bill and months hence and 3% per annum.
face value (or actual amount) of the bill. a) Rs 63.75 b)Rs61.75 c)Rs 64.75 d)Rs 63.25
2. In Arithmetic 'Discount' always means 'True Dis- 3. The true discount on a bill of Rs 3720 due after 4 months
count' unless Banker's Discount is expressly meant. is Rs 120. Find the banker's discount.
Banker's Discount is generally denoted by BD. a)Rsl22 b)Rsl34 c) 124 d) None of these
Important Results
Answers
(i) Banker's Discount (BD) = Simple interest on bill for 1. a; Hint: Amount = Rs 1860; True Discount * Rs 60
its unexpired time
• Present Worth = Rs 1860 - Rs 60 - Rs 1800
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716 PRACTICE BOOK ON QUICKER MATHS

SI on Rs 1800 for 8 months = Rs 60 Answers

1. d; Hint: Present Worth = Rs 1860 - Rs 60 = Rs 1800
\
100x60 (TD) Z 60x60
Rate = % = 5% BG = = Rs2
1800x Present Worth 1800
2. a
3. c; Hint: Present Worth = 540 - 90 = Rs 450
1860x5x-
90x90
Banker's Discount = -2- = R 62
S
Banker's Gain = — = Rs 18
100 450
2. a 3.c .-. Banker's discount = 90 + 18 = Rs 108 [See Note].
(TD) 36x36
Rule 2 4. c; Hint: BG = = Rsl.62.
PW ^ 800
To find the Banker's Gain (BG) when Bill Amount (A), rime
.-. BD = TD + BG = Rs36 + Rsl.62 = Rs37.62
(T) and Rate (R) are given.
5. b; Hint: Difference between the banker's discount and the
A(RT) (TD)'2
true discount = Banker's gain.
(I) Banker's Gain = , or,
1 f t f t / l f t n D T N
100(100 + RT) PW '
8100x5x-x5xl
where TD = True Discount, PW = Present Worth 4 4
required answer = Rs 1.25.
AxRxT 100 100 + 5x
(11) True Discount (TD) =
100 + R T

Illustrative Example Rule 3

Ex: Find the banker's gain on a bill of Rs 2550 due 4 months
To find theface value (or bill amount) when Banker's Dis-
hence at 6% per annum.
count (BD) and Time (T) are given.
Soln: Applying the above formula, we have
IOOXBD
Face value (A) =
RxT
2550x 6x
2550x4 Illustrative Example
Banker's Gain = = Rel. Ex: I f the B . D on a bill at 4% per annum is Rs 60, find the
100x102
100 100+ 6x face value of 6 months bill.
Soln: Applying the above formula, we have
Note: Banker's Gain = BD - TD [ie if you calculate TD, you
100x60
can find the Banker's Gain by subtracting TD from Face value = Rs3000
BD. 4x-
12
Exercise
1. The true discount on a bill of Rs 1860 due after 8 months Exercise
is Rs 60. Find the banker's gain. 1. I f the B.D on a bill at 8% per annum is Rs 120, find the
a)Rsl.5 b)Rs2.5 c)Rs4 d)Rs2 face value of 1 year bill.
2. Find the banker's gain on a bill of Rs 6900 due 3 years a) Rs 3000 b) Rs 750
hence at 5% per annum simple interest. c)Rsl500 d)Rs2250
a)Rsl35 b)Rsl25 _c)Rsl85 d)Rsl45 2. If the B.D on a bill at 5% per annum is Rs 135, find the
3. The true disocunt on a bill of Rs 540 is Rs 90. The banker's face value of 9 months bill.
discount is: a)Rs3600 b)Rs3650
a)Rs60 b)Rsl50 c)Rsl08 d)Rsll0 c)Rs2750 d)Rs3250
4. The present worth of a certain bill due sometime hence 3. If the B.D on a bill at 6% per annum is Rs 63, find the face
is Rs 800 and the true discount is Rs 36. Then, the banker's value of 3 months bill.
discount is: a)Rs415<) b)Rs4200
a)Rs37 b)Rs 34.38 c)Rs 37:62 d)Rs 38.98 c)Rs4250 d) None of these
5. Find the difference between the banker's discount and Answers
the true discount on Rs 8100 for 3 months at 5%. !.c 2.'a 3.b
a)Rs0.125 b)Rsl.25 c)Rs!2.5 d) None of these
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i Banker's Discount 717

Rule 4 5% being given that the banker's gain is Rs 90.

a)Rs550 b)Rs650 c)Rs690 d)Rs600
To find the Banker's Discount if True Discount, Rate and
2. The banker's gain on a bill due 1 year 4 months hence at
Time are given.
Banker's Discount
7^-% per annum simple interest is Rs 16. Find the sum.
Rate x Time RT
True Discount 1 + = TD 1 + a)Rsl760 b)Rsl560 c)Rsl660 d)Rsl860
100 Too
3. The banker's gain on a bill due 1 year hence at 5% is Re
Illustrative Example 1. The true discount is:
Ex: If the TD on a certain sum due 9 months hence at 4% a)Rsl5 b)Rs20 c)Rs25 d)Rs5
is Rs 20. What is the BD on the same sum for the same
Answers
time and at the same rate?
90x100
Soln: Applying the above formula, we have 1. c; Hint: True Discount = ——2— Rs 600
=

3x5
4x9
BD=20 1 + = Rs 20.60. .-. Banker's Discount = True Discount + Banker's Gain
12x100 = Rs600 + Rs90 = Rs690
16x100
Exercise 2. a; Hint: TD = j p= = Rs 160
1. If the true discount on a certain sum due 6 months hence —x —
at 6% is Rs 36, what is the banker's discount on the same 3 2
sum for the same time and at the same rate? BD = Rsl60 + Rs 16 = R s l 7 6
a) Rs 37.80 b)Rs 27.08 c)Rs 37.08 d) None of these
176x100
2. The banker's discount on a bill due 6 months hence at Sum = = Rsl760 [See Rule 3]
4 15
6% is Rs 37.08. Find the true discount. —x —
a)Rs38 b)Rs32 c)Rs36 d)Noneofthese 3 2
,1 BGxlOO 1x100
3. If the TD on a certain sum due 1 — years hence at 8% is 3.b; Hint: TD = = Rs20.
RxT 5x1
Rs 25. What is the BD on the same sum for the same time
and at the same rate?
Rule 6
a) Rs 27.50 b)Rs 28.50 c)Rs28 d)Rs 27.25
To find the Banker's Discount when True Discount and the
Answers Face Value are given.
1. c Banker's Discount
3708
2. c; Hint: 37.08 = TD 1 ,A A .-. TD = Rs36 Bill Amount or Face Value x True Discount AxTD
100 103
~~ Bill Amount or Face Value-True Discount A-TD
3. c
Illustrative Example
Rule 5 Ex: If the true discount on a bill for Rs 480 is Rs 80. Find
To find Banker's Gain (BG) when True Discount (TD), Rate the bankers' discount.
(R) and Time (T) are given. Soln: Applying the above formula, we have
Banker's Gain (BG)
480x80 480x80
True Discount x Rate x Time TD x R x T Banker's Discount 1
= Rs96
480-80 400
100 ~ 100
Illustrative Example Exercise
Ex: If the TD on a certain sum due 4 years hence at 4% is 1. I f the true discount on a bill for Rs 560 is Rs 60. Find the
Rs 250. What is the Banker's gain (BG) on the same bankers' discount.
sum for the same time and at the same rate? a)Rs67.2 b)Rs68 c)Rs68.5 d)Rs67.5
Soln: Applying the above theorem, we have 2. If the true discount on a bill for Rs 450 is Rs 50. Find the
250x4x5 bankers' discount.
Banker's Gain = — — = Rs 50. a) Rs 66.25 b)Rs 56.25 c)Rs 56.50 d) None of these
3. If the true discount on a bill for Rs 670 is Rs 70. Find the
Exercise bankers' discount.
1. Find the banker's discount on a bill due 3 years hence at a)Rs88 b)Rs76 c)Rs78 d)Rs80
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718 PRACTICE BOOK ON QUICKER MATHS

Answers hence is Rs 165. Find the true discount and the banker's
I.a 2.b 3.c gain.
a)Rsl50,Rsl5 b)Rsl60,Rs5
Rule 7 c)Rsl45,Rs20 d) None of these
To find present worth, when Banker's Gain (BG), Time (T) 3. The present worth of a certain bill due some time hence
and Rate (R) are given: is Rs 1600 and the true discount on the bill is Rs 160.
Find the banker's discount and the extra gain the banker
H.NJ
would make in the transaction.
Present worth = Banker's Gain x
RT a)Rsl76,Rsl8 b)Rsl86,Rsl6
c)Rsl76,Rsl6 d) None of these
Illustrative Example 4. The present worth of a sum due sometimes hence is Rs
EK The banker's gain on a bill due 4 years hence at 5% is 576 and the banker's gain is Re 1. The true discount is:
Rs 40. Find the present worth of the bill. a)Rsl6 b)Rsl8 c)Rs24 d)Rs32
Soln: Applying the above formula, we have
Answers
100x100
Present Worth = 4 0 x = 25 x40 = Rsl000. l.a;Hint:TD= V P W X B G
20x20
(TP) 110x110
Exercise or, BG = = Rs 11
PW 1100
1. The banker's gain on a bill due 2 years hence at 5% is Rs
.-. BD = BG + TD = R s ( l l + 110) = Rsl21.
8, find the present worth of the bill.
a)Rs800 b)Rs650 c)Rs750 d)Rs850 BDxTD BDxTD
2. The banker's gain on a bill due 2 years hence at 6% is Rs 2. a; Hint: Sum = B D - T D BG
36. Find the present worth of the bill.
TD Sum 1650 10
a)Rs2400 b)Rs2550 c)Rs2440 d)Rs2500
3. The banker's gain on a bill due 3 years hence at 5% is Rs BG BD 165 1
45. Find the present worth of the bill. i.e., if BG is Re 1, TD = Rs 10 or BD = Rs 11
a)Rs2000 b)Rs2200 c)Rs2250 d) None of these .-. If BD is Rs 11, TD = Rs 10
Answers 10
If BD is Rs 165,TD = Rs xl65 Rs 150
„ 100x100 11
1. a; Hint: Present Worth = 8 x — — = R s goo
10x10 Also BG = Rs (165- 150) = Rsl5.
2.d 3. a
3. c; Hint: 160= V l 6 0 0 x B G
Rule 8
To find True Discount when present worth and Banker's 160x160
Gain are given. •• B G = - 7 6 ^ = R s 1 6

True Discount'= ^ P W x B G .-. Banker's Discount = 160 + 16 = Rs 176.

[ v BD=TD+BG].
Illustrative Example
4. c;Hint:TD= ^ ( P W x B G ) = ^(576x1) =Rs24.
Ex: The present worth and the banker's gain on a bill is
Rs 160000 and Rs 25 respectively. Find the discount
of the bill. Rule 9
Soln: Applying the above formula, we have Tofind the sum or Bill Amount when the banker's discount
and the true discount are given.
True Discount = Vl60000x25 =400x5 = Rs2000.
Ban ker's Discount x True Discount
Exercise Bill Amount (A) = B a. Discount - True Discount
nk e r s

1. The present worth of a bill due sometime hence is Rs

1100 and the true discount on the bill is Rs 110. Find the Banker's Discount x True Discount
banker's discount and the extra gain the banker would
Banker's Gain
make in the transaction.
a)Rsll,Rsl21 b)Rs21,Rsl31 Illustrative Example
c) Rs 12, Rs 122 d) None of these Ex: The bankers discount and the true discount on a cer-
2. The banker's discount on Rs 1650 due a certain time tain sum is Rs 50 and Rs 40. Find the sum.
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Banker's Discount 719

Soln: Applying the above formula, we have the same rate. Find the time.
Soln: Applying the above theorem, we have
50x40
S u m = Io^o-=Rs20°- 100(1050-1000)

Exercise
Time= —j^m— =lyear

1. The banker's discount and the true discount on a sum of lOOf y - x ^

money due 8 months hence are Rs 52 and Rs 50, respec- Note: I f time is given, R can be calculated by j I I
tively. Find the sum and the rate per cent.
per cent.
a) Rs 1300,6% b) Rs 1200,5%
c) Rs 1500,8% d) None of these Exercise
2. The banker's discount on a certain sum of money is Rs 1. The banker's disocunt on Rs 1800 at 5% is equal to the
36 and the discount on the same sum for the same time true discount on Rs 1830 for the same time and at the
and at the same rate is Rs 30. Find the sum. same rate. Find the time.
a)Rsl50 b)Rsl90 c)Rsl65 d)Rsl80 a) 3 months b) 4 months
3. The banker's discount on a bill due 1 year 8 months c) 6 months d) None of these
hence is Rs 50 and the true discount on the same sum at 2. The banker's discount on Rs 1600 at 6% is the same as
the same rate per cent is Rs 45. The rate per cent is: the true discount on Rs 1624 for the same time and at the
44 same rate. Then, the time is:
a) 6% b) e | % c) 6 - % a) 3 months b) 4 months c) 6 months d) 8 months
2
3. The banker's discount on Rs 800 at 15% is equal to the
Answers true discount on Rs 950 for the same time and at the
same rate. Find the time.
BDxTD (52x50
1. a; Hint: Sum = gQ_-j-[) ; Rsl300 .1 ,1
a) 1— years b) 1— years
Since BD is SI on sum due, so SI on Rs 1300 for 8 months
is Rs 52. Consequently,
c) I- years d) None of these
/ ^
100x52 Answers
Rate = % = 6%
1. b
1300x:
2. a; Hint: SI on Rs 1600 = TD on Rs 1624
.-. Rs 1600isPWofRs 1624
2.d
i.e., Rs 24 is the SI on Rs 1600 at 6%
BDxTD 50x45 (100x24") _ 1
3. c; Hint: Sunv Rs450
BD-TD ••• l l 6 0 0 x 6 j ~ 4 y<*r= 3 months.
T i m e =

Now, Rs 50 is SI on Rs 450 for (5/3) years. Note: Try to solve by direct formula also.
3. fa

100x50 Rule 11
Rate^ = 6-%
3 Theorem: If the banker's gain on a certain sum due 'T'
450 x -
x
years hence is ~ of the banker's discount on itfor the same
Rule 10
time and at the same rate then the rate per cent is given by
Theorem: The banker's discount on Rs x at R% is equal to
the true discount on Rsy for the same time and at the same 100
T \_y-x
lOOf y-
rate. Then the time is given by ^ 1 ; years. Note: Herex<>>.
Illustrative Example
Illustrative Example Ex: If the banker's gain on a certain sum due 4 years hence
Ex: The banker's discount on Rs 1000 at 5% is equal to
the true discount on Rs 1050 for the same time and at is — of the banker's discount on it for the same time
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720 PRACTICE BOOK ON QUICKER MATHS

and at the same rate, find the rate per cent. time and at the same rate. Find the rate per cent.
Soln: Applying the above theorem, we have Soln: Applying the above theorem, we have the
Required rate per cent ,100(11 ^ 1
required rate per cent = LQ 1 I = 20 X — - 2 /O
100 25x9 9 1
4 59-9 ^ = ~ = 4-percent Note: When in place of time (T), rate (R) is given, then the
time (T) can be calculated by
Note: When in place of time, rate (R) is given then the time
(T) can be calculated by 100
T= *-i
7T years.
100
R years.
y-x
Exercise
Exercise 1. The banker's discount on a certain sum due 2 years hence
11
1. The banker's gain on a certain sum due 2 — years hence is — of the true discount on it for the same time and at
the same rate. Find the rate per cent.
is r r of the banker's discount on it for the same time a) 2% b)3% c)4% d)5%
and at the same rate. Find the rate per cent, 2. The banker's discount on a certain sum due 3 years hence
a) 5% b)4% c)8% d)6% 31
2. If the banker's gain on a certain sum due 5 years hence is is — of the true discount on it for the same time and at
1 the same rate. Find the rate per cent.
— of the banker's discount on it for the same time and at
a) 6% b)7% c)8% d) None of these
the same rate, find the rate per cent.
3. The banker's discount on a certain sum due 4 years hence

a) 4% b)5% c)6% d) 5 - o / 0 21
2 is — of the true discount on it for the same time and at
If the banker's gain on a certain sum due 3 years hence is
the same rate. Find the rate per cent.

— of the banker's discount on it for the same time and

J I a) l i % b) 2 - % c)l-% d) None of these
at the same rate, find the rate per cent.
a) 5% b)6% c)8% d)9% Answers
l.d 2.c 3.a
Answers
100x2 Rule 13
1. d; Hint: Rate per cent = = 6% Theorem: If the rate per cent and timefor a bill are numeri-
23-3
cally equal and also the true discount is 'n' times the
2. b 3.c
banker's gain, then the rate per cent or time is given by
Rule 12
Theorem: If the banker's discount on a certain sum due 'T'
x
4
Illustrative Example
Ex: If the rate per cent and time for a bill are numerically
years hence is ~ of the true discount on it for the same equal and also the true discount is 25 times the
banker's gain, find the rate per cent.
time and at the same rate, then the rate per cent is given by
100 Soln: Applying the above theorem, we have

y T
Rate per cent = 10, 2 per cent.
:
25
Note: Here.v>y.
Note: I f time and rate are not equal, use the following result
Illustrative Example to calculate R and T.
Ex: The banker's discount on a certain sum due 5 years RT
11 Too
hence is — of the true discount on it for the same
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Exercise Illustrative Example

1. I f the rate per cent and time for a bill are numerically Ex: The banker's discount and banker's gain are Rs 125
equal and also the true discount is 4 times the banker's and Rs 5 respectively. Find the amount of the bill.
gain, find the rate per cent. Soln: Applying the above formula, we have
a) 5% b)4% c)6% d)3% 125x(125-5)
2. I f the rate per cent and time for a bill are numerically Bill amount = 125 x 24 = Rs 3000.
equal and also the true discount is 16 times the banker's
gain, find the rate per cent.
Exercise
1. The banker's discount and banker's gain are Rs 120 and
a) 2 - % b)5% c)6% d)4% Rs 5 respectively. Find the amount of the bill.
2 a)Rs2760 b)Rs2560 c)Rs2670 d) None of these
3. I f the rate per cent and time for a bill are numerically
2. The banker's discount and banker's gain are Rs 144 and
equal and also the true discount is 9 times the banker's
Rs 12 respectively. Find the amount of the bill.
gain, find the rate per cent.
a)Rsl854 b)Rsl485 c)Rsl584 d)Noneofthese
„1 3. The banker's discount and banker's gain are Rs 49 and
a) 2% b)3% c ) 3 j % d) None of these
Rs 7 respectively. Find the amount of the bill.
Answers a)Rs294 b)Rs284 c)Rs249 d)Rs274
l.a 2.a 3.c Answers
l.a 2.c 3.a
Rule 14
To find the true discount if the banker's discount and bill Miscellaneous
amount are given.
Exercise
Bill Amount x Banker's Discount
True Discount = 1. What rate per cent does a man get for his money when in
Bill Amount + Banker's Discount
discounting a bill due 10 months hence, he deducts 4%
Illustrative Example of the amount of the bill?
Ex: If the B.D on a bill for Rs 540 is Rs 108. Find the true a) 5% b)6% c)8% d)4%
discount. 2. A bill was drawn on March 8, at 7 months date and was
Soln: Applying the above theorem, we have discounted on May 18, at 5%. I f the banker's gain is Rs
3, find
540x108
(i) the true discount
TD= =Rs9a a)Rsl60 b ) R s l 5 2 c)Rsl53 d)Rsl50
Exercise (ii) the banker's discount and
1. I f the B.D on a bill for Rs 650 is Rs 150. Find the true a)Rsl53 b)Rs 151 c)Rsl55 d)Rsl63
discount. (iii) the sum of the bill.
a)Rsl20 b)Rs 129.8 c)Rs 121.8 d)Rs 120.8 a) Rs 7650 b) Rs 7550
2. If the B.D on a bill for Rs 540 is Rs 180. Find the true c) Rs7850 d) None ofthese
discount. 3. The holder of a bill for Rs 17850 nominally due on 21st
a)Rsl30 b)Rsl35 c)Rsl25 d) None of these May, 1991 received Rs 357 less than the amount of the
3. I f the B.D on a bill for Rs 350 is Rs 50. Find the true bill by having it discounted at 5%. When was it
discount. disocunted?
a) Rs 43.75 b)Rs45 c)Rs 39.75 d) None of these a) Dec 29,1990 b) Dec 30,1989
c) Dec 19,1990 d) None of these
the Answers 4. A bill for Rs 5656 is drawn on July, 14 at 5 months. It is
l.c 2.b 3.a discounted on Oct 5th at 5%.
Rule 15 (i) banker's discount
To find the amount of bill or bill amount or face value a) Rs 56.56 b)Rs56 c)Rs 56.50 d) None of these
when Banker's Discount and Banker's gain are given. (ii) true discount
esuh Bill Amount (A) a)Rs50 b)Rs 54.56 c) Rs 56 d) None of these
(iii) banker's gain and
Ban ker's Discount x (Ban ker' J Discount - Ban ker's Gain)
a)Rs6.56 b)Rsl.44 c)Rs0.56 d)None ofthese
Ban ker's Gain
(iv) Money received by the holder of the bill,
BDx(BD-BG) a) Rs 5599.56 b)Rs 5599.44
BG ,
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722 PRACTICE BOOK ON QUICKER MATHS

c) Rs 5599 d) None of these

... 2 5
A banker paid Rs 5767.50 for a bill of Rs 5840, drawn on ;Rsl50 + Rs 1 5 0 x y x ^ =Rsl53.
April 4, at 6 months. On what day was the bill discounted,
the rate of interest being 7%? BDxTD 153x150
a) 3rd Aug b) 4th Aug c) 3rd Sep d) 3rd Jul (iii) a; Sum ! = Rs7650.
BD-TD 153-150
3. a; Hint: Clearly, SI on Rs 17850 at 5% is Rs 357.
The banker's discount on a sum of money for \ years
(100x357
is Rs 60 and the true discount on the same sum for 2 146 days.
T i m e = 17850^5
years is Rs 75. The rate per cent is:
So, the bill is 146 days prior to 24th may, the legally due
,2
„1
a) 5% b) 6% c) d) 3-o/
6-0/0 0 date.
3-• May April March Feb Jan Dec
A bill is discounted at 5% per annum. I f banker's dis- 24+ 30+ 31 + 28+ 31 + 2 = 146 days.
count be allowed, at what rate per cent must the pro- So, the bill was discounted on Dec 29,1990.
ceeds be invested, so that nothing may be lost? 4. Hint: (i) a; Face value of the bill = Rs 5656
Date on which the bill was drawn = July, 14th at 5 months.
a) 5% b 4 ) Yi % ) ]|
b 5 %
d) 10% Nominally due date = December, 14 th
Legally due date = December, 17th.
8. The interest on a certain sum of money is Rs 67.20 and
Date on which the bill was discounted = October, 5th
the discount on the same sum of money for the same
Period for which the bill has yet to run
time and at the same rate is Rs 60. What is the sum?
Oct Nov Dec
a)Rs560 b)Rs480 c)Rs590 d)Rs860
1
Answers 26 + 30 + 17 = 73 days or — year
l.a; Hint: Let the amount of bill be Rs 100.
Money deducted = Rs 4
.-. BD = SI on Rs 5656 fpr - years at 5%
Money received by holder of the bill
= Rs(100-4) = Rs96
^5656x1x5^
SI on Rs 96 for 10 months = Rs 4 = Rs = Rs 56.56
100x5
100x4x6
Rate : = 5%.
96x5
5656x5x —
2. Hint: Date on which the bill was drawn 5
= March 8th at 7 months. ( i i ) c ; T D = Rs ' Rs56
Nominally due date = Oct 8th. 100+ 5x
Legally due date Oct, 11th.
Date on which the bill was discounted = May, 18th. (iii) c; BG = BD - TD = 56 paise
Time for Which the bill has yet to run (iv) b; Money received by the holder of the bill
May June July Aug Sep Oct = Rs (5656 - 56.56) = Rs 5599.44.
5. a; Hint: BD = Rs (5840 - 5767.20) = Rs 72.80
13 + 30+ 31 + 31 + 30+ 1 1 = 146 days = - years. .-. Rs 72.80 is SI on Rs 5840 at 7%

Now (i) d; Banker's gain = SI on TD 100x72.80 13 •

So, unexpired time = _ ,_ = — years = 65 days.
7x5840 73
i.e., Rs 3 is SI on TD for — years at 5% Now, date of draw of bill = April, 4 at 6 months.
Nominally due date = October, 4
Legally due date = October, 7
100x3
So, we must go back 65 days from October, 7
•. TD = Rs ±2 =
5
=R s l 5 0
x
Oct Sept Aug = 7 + 30 + 28
5
i.e., The bill was discounted on 3rd August.
(ii)a;BD = TD + SI on TD 6. d; Hint: BD for (3/2) years = Rs 60

f60x2 ,1
Rs 150 + SI on Rs 150 for ~ years at 5%
BDfor2years = Rs — I — x 2 =Rs80
 Banker's Discount
https://telegram.me/Banking_Zone https://telegram.me/pdf4exams 723

Now, BD = Rs 80 : TD = Rs 75 and Time = 2 years. Proof: Sum = PW + T D

.. Interest on sum = Int on PW + Int on TD = TD + Int
( 80x75"!
.-. Sum = R s l — ; — j = R s l 2 0 0 onTD
Interest on sum - T D = Int on TD or, Banker's gain =
.-. Rs 80 is SI on Rs 1200 for 2 years. IntonTDj
In the given question, we have
100x80\ Rs 67.20 - Rs 60 = Int on Rs 60
So, rate :
% = 3-o/ 0

,1200x2, 3
1
7. c; Hint: Let the sum be Rs 100. Then, BD = Rs 5. Rs 7 Int on Rs 60
Proceeds = Rs (100 - 5) = Rs 95
.-. Rs 5 must be the interest on Rs 95 for 1 year. 60
Re 1 = Int on Rs
e 100x5" 1
So, rate =
95x1 = V -
/o

8. a; Hint: Interest on Sum - True Discount = Interest on True

• Rs 6 7 - = I n t o n R s — x 6 7 -
r
Discount 5 1 5
[ The difference between the simple interest and the 5
true discount on a sum of money is equal to the simple
interest on the true discount for the given time at the
given rate per cent. .-. the required sum = Rs —~- x 67 — = Rs 560.
7± 5