Jagatram, a trader, owes a merchant. Mangalal ₹ 5014 due 1 yr hence. Jagatram wants to settle the account after 3 months. If the rate of interest is 12% per annum, how much cash should Jagatram pay?
Correct Answer: ₹ 4600
Explanation:
Required cash = PW of ₹ 5014 due 9 month hence
= {95014 x 1000} /{100 + 12 x (9/12)}
= (5014 x 100)/(100 + 9)
= (5014 x 100)/109
= ₹ 4600
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