Exam Information| Govt Jobs.| Exam Preparation | Exam Study Material |Exam Date|Material PDF

True Discount - Important Formulas | Aptitude

IMPORTANT CONCEPTS
Suppose a man has to pay Rs. 156 after 4 years and the rate of interest is 14% per annum. Clearly, Rs. 100 at 14% will amount to R. 156 in 4 years. So, the payment of Rs. now will clear off the debt of Rs. 156 due 4 years hence. We say that:
Sum due = Rs. 156 due 4 years hence;
Present Worth (P.W.) = Rs. 100;
True Discount (T.D.) = Rs. (156 - 100) = Rs. 56 = (Sum due) - (P.W.)
We define: T.D. = Interest on P.W.;     Amount = (P.W.) + (T.D.)
Interest is reckoned on P.W. and true discount is reckoned on the amount.
IMPORTANT FORMULAE
Let rate = R% per annum and Time = T years. Then,
1.   P.W. =100 x Amount=100 x T.D.
100 + (R x T)R x T
2.   T.D. =(P.W.) x R x T=Amount x R x T
100100 + (R x T)
3.   Sum =(S.I.) x (T.D.)
(S.I.) - (T.D.)
4.   (S.I.) - (T.D.) = S.I. on T.D.
5.   When the sum is put at compound interest, then P.W. =Amount
1 +RT
100

No comments:

Post a Comment

LinkWithin