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1. The difference between simple interest and the true discount on Rs. 2400 due 4 years hence at 5% per annum simple interest is -

A. Rs. 70

B. Rs. 30

C. Rs. 50

D. Rs. 80

Solution:

\begin{aligned} Given A = 2400 \\ R = 5 % \\ T = 4 year \\ ∴ T D = \frac{A \times R \times T}{100 + R \times T} \\ T D = \frac{2400 \times 4 \times 5}{100 + 20} \\ T D = Rs . 400 \\ ∴ S .I . - TD = \frac{T D \times R \times T}{100} \\ = \frac{400 \times 5 \times 4}{100} \\ = Rs . 80 \end{aligned}

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