A owes B Rs. 456.75 payable 4 1/ 2 months hence and B owes A Rs. 455.51 payable 3 months hence. If they agree to settle their account by a ready money payment. What sum should be paid over and to whom reckoning the rate of true discount at 4 per cen…

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Time = 41/2 months = 3/8 year, Rate = 4 percent ∴ Amount of Rs. 100 = 203/2 ∴ P.W. = Rs. 456.75 / (203/2) x 100 = Rs. 450 Again, time = 3 months = 1/4 year, rate = 4 percent P.W. = Rs. 455.51 x 10…

A owes B Rs. 456.75 payable 4 1/ 2 months hence and B owes A Rs. 455.51 payable 3 months hence. If they agree to settle their account by a ready money payment. What sum should be paid over and to whom reckoning the rate of true discount at 4 per cent per annum?

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