Aptitude - True Discount - Discussion

What does true discount mean? is it means the amount of interest for a certain time of a certain amount of money?

How come 15% I can't understand since 122 is the interest for 4 months then for each month it is 30.5,

Then it should be 12.5%,

Since 10% 24.4 and 2.5 % is 6.1 so the should be 12.5%.

I guess can you explain it please.

Rate percent is normally calculated for a year by doing 30.5/2440 we are not calculating for a year since 30.5 corresponds to a month only.

Friends,

SI = interest on principal amount,

in the same way,

TD = interest on present worth,so v take PW instead of principal.

In question they gave TD with principal,so we first calculate the PW from principal & TD using the formula PW= principal-TD and then we calculate rate using the formula which is similar to the SI.

Dear guys:

Don't think so much about the formula of personal wealth and discount. Moreover its conceptual question.

If someone returning money in 4 month he will get discount of INR 122 over the amount.

So instead of paying 2562 he is only paying = 2440 before 4 month otherwise he will pay 2562 after 4 month.

So 2562-2440 = 122 is interest which we getting at the end of 4 month.
So simple interest is = 122.

Formula for s.i = p*r*t/100.

So r = s.i*100/p*t(time should be in year so we use 1/3 year).

r = 122*100/2440*1/3 = 15%.

@Deepa you are only used in correct formula.

Answer explanation:

PW= 100*amount/R*T.

Therefore from the above formula , we need to find R. Hence formula becomes,

R= 100*amount/P*T ------(1).

Here amount = Rs.122 is the discount amount for 4 years.

P = 2562-122 = 2418 is the original amount after applying discount.
T= 4 out of 12 months i.e = 4/12 = 1/3.

Substitute the values in (1), you will get the answer

Is present worth and principal amount same here?

But in the previous question he calculated pw is 100 and principal is 122?

Can anyone share formula of calculating rate of interest?

Hi,

I can't understand the true discount concept. Can anyone explain me clearly step by step?