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The true discount on a bill of Rs. 2160 is Rs. 360. What is the banker's discount?

Correct Answer: Rs. 432

Explanation:

F = Rs. 2160
TD = Rs. 360
PW = F - TD = 2160 - 360 = Rs. 1800
True Discount is the Simple Interest on the present value for unexpired time
=>Simple Interest on Rs. 1800 for unexpired time = Rs. 360
Banker's Discount is the Simple Interest on the face value of the bill for unexpired time
= Simple Interest on Rs. 2160 for unexpired time


=(360/1800)* 2160


= (1/5) * 2160


=Rs. 432


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