Find the true discount on Rs 500 due 4 years hence, at 25% per annum simple interest.

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Rs 250. The amount due after 4 years is Rs 500. The rate is R = 25% per year. The time is T = 4 years. Present Worth (P.W.) is the sum that, invested now at this rate, would grow to the Amount by the due date. The formula is P.W. = (100 x Amount) / (100 + R x T). The numerator is 100 x 500 = 50000. The denominator is 100 + 25 x 4 = 200. So P.W. = 50000 / 200 = Rs 250. True Discount (T.D.) is the reduction for paying early: T.D. = Amount - P.W. T.D. = 500 - 250 = Rs 250. Check: P.W. + T.D. = 250 + 250 = 500, which matches the Amount.

Find the true discount on Rs 500 due 4 years hence, at 25% per annum simple interest.

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