The true discount on a bill is Rs. 120 and the banker’s gain is Rs. 6. What is the present worth?
Correct answer D. Rs. 2,400
Explanation
Since banker's gain BG = TD²/PW, rearranging gives the present worth PW = TD²/BG = 120²/6 = 14,400/6 = Rs. 2,400.
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