Solve this multiple-choice question and choose the correct option.

Given data t = 2 years, r = 10% p.a. ⇒ r t = 20 BG = Rs. 24 PW = ? Concept/ApproachSince TD / PW = r t / 100 = 20/100 = 0.2 we have TD = 0.2 × PW. Also BG = TD2 / PW. Step-by-step calculationBG = (0.2 PW)2 / PW = 0.04 PW0.04 PW = 24 ⇒ PW = Rs. 600 Verification/AlternativeThen TD = 0.2 × 600 = 120; BG = TD2 / PW = 14,400 / 600 = 24 (checks). Common pitfallsConfusing PW with sum due (face value A). Here we only need PW. Final AnswerRs. 600

Curioustab

Banker's gain for a sum due 2 years hence at 10% p.a. is Rs. 24. Find the present worth.

Aptitude Banker's Discount Difficulty: Medium

Choose an option

A

Rs. 500
B

Rs. 600
C

Rs. 720
D

Rs. 800

Answer

Correct Answer: Rs. 600

Explanation

Given data

t = 2 years, r = 10% p.a. ⇒ r t = 20
BG = Rs. 24
PW = ?

Concept/ApproachSince TD / PW = r t / 100 = 20/100 = 0.2 we have TD = 0.2 × PW. Also BG = TD² / PW.

Step-by-step calculationBG = (0.2 PW)² / PW = 0.04 PW0.04 PW = 24 ⇒ PW = Rs. 600

Verification/AlternativeThen TD = 0.2 × 600 = 120; BG = TD² / PW = 14,400 / 600 = 24 (checks).

Common pitfallsConfusing PW with sum due (face value A). Here we only need PW.

Final AnswerRs. 600

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