Present worth at simple interest: Find the present worth of Rs. 264 due in 2 years when simple interest is reckoned at 5% per annum.

Introduction / Context: Present worth (PW) is the current value of a future sum under simple interest. The relation is PW = S / (1 + r * t), where S is the future amount, r is annual simple interest rate, and t is time in years.

Given Data / Assumptions:

• S = Rs. 264 (due after 2 years).
• r = 5% per annum.
• t = 2 years.

Concept / Approach: Apply PW formula directly: divide the future amount by (1 + r t). Ensure r is expressed as a decimal and time is in years.

Step-by-Step Solution:

Verification / Alternative check: Re-accumulating PW at 5% for 2 years: 240 * (1 + 0.10) = 240 * 1.10 = 264; consistent.

Why Other Options Are Wrong: Rs. 260 and Rs. 252 are too high; Rs. 360 and Rs. 540 are unrelated to discounting.

Common Pitfalls: Multiplying instead of dividing by (1 + r t); using compound interest when simple interest is specified.

Final Answer: Rs. 240