The present worth of Rs. 1404 due in two equal half yearly instalments?
Correct Answer: Rs. 1325
Explanation:
Required sum = P.W. of Rs. 702 due 6 months + P.W. of Rs. 702 due 1 year hence.
= Rs. {100 x 702} / {100 + 8 x (1/2)} + Rs. {100 x 702} / {100 + 8 x 1}
∴ Total P.W. = Rs. (675 + 650)
= Rs. 1325
