Discussion
The true discount on Rs. 2200 due 1 year hence at 10% per annum is:
Answer: B
Correct answer: Rs. 200
True discount is the interest on the present worth, not on the amount, so it is found from
\[TD = \frac{A \times R \times T}{100 + RT} = \frac{2200 \times 10 \times 1}{100 + 10} = \frac{22000}{110} = 200\]
The present worth is Rs. 2000, and the interest on that for one year at 10% is indeed Rs. 200.
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