If ₹ 10 is the true discount on a bill of ₹ 110 due at the end of a certain time, then what discount would be allowed on the same amount due at the end of double the time (same rate, simple interest)?
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A₹ 20.00
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B₹ 21.81
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C₹ 22.00
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D₹ 18.33
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E₹ 19.80
Answer
Correct Answer: ₹ 18.33
Explanation
Introduction / Context: True discount increases nonlinearly with time. Given TD at time t, we find TD at 2t using the TD formula.
Given Data / Assumptions:
- F = 110
- TD(t) = 10
- Need TD(2t) at same rate
Concept / Approach: TD = F * x/(1 + x) where x = r * t. First get x from TD(t), then compute TD at 2x.
Step-by-Step Solution: 10 = 110 * x/(1 + x) → x = 10/(110 − 10) = 10/100 = 0.1. At double time, x' = 0.2. TD(2t) = 110 * 0.2/(1.2) = 110 * (1/6) = 18.333... ≈ ₹ 18.33.
Verification / Alternative check: Present worths: P(t) = 110/1.1 = 100; P(2t) = 110/1.2 ≈ 91.666...; TD(2t) = 110 − 91.666... = 18.333..., matching.
Why Other Options Are Wrong: ₹ 20 and ₹ 22 assume linear doubling; ₹ 21.81 is not the exact rational outcome; ₹ 19.80 does not follow from the formula.
Common Pitfalls: Assuming TD doubles with time; ignoring the (1 + x) denominator.
Final Answer: ₹ 18.33