studysite.org
        You must need it


New : Electrical Engineering
For premium access

 


Home->Aptitude->True Discount -> Important Formulas

True Discount :-

Choose Your Formula/Rule for quicker method
IMPORTANT EXAMPLES
::Important Formulas

Here Some Basic Formulas/Rules Are given below :-

Suppose a man has to pay Rs. 156 after 4 years and the rate of interest is 14% per annum Clearly, Rs. 100 at 14% will amount to Rs. 156 in 4 years. So, the payment of Rs. 100 now will clear off the debt of Rs. 156 due 4 ,years hence. We say that :
Sum due = Rs. 156 due 4 years hence;
Present Worth (P.W.) = Rs. 100;
True Discount (T.D.) = Rs. (156 - 100) = Rs. 56 = (Sum due) - (P.W.).
We define : T.D. = Interest on P.W.
Amount = (P.W.) + (T.D.).
Interest is reckoned on P.W. and true discount is reckoned on the amount.
    Let rate = R% per annum and Time = T years. Then,
  1. P.W. = 100 X Amount   = 100 X T
             100 + (R X T)       R X T

  2. T. D. = (P.W.) X R X T   = Amount X R X T
                     100              100 + (R X T)  

  3. Sum =  (S. I.) X (T. D.) 
             (S. I. ) - (T. D. )

  4. (S. I. ) - (T. D. ) = S. I. on T.D.

  5. When the sum is put at compound interest, then P.W. = Amount / (1 + R/100 )T


Click Here for Important Examples