Multiple choice

The present worth of $Rs. 1404$ due in two equal half-yearly installments at $8$% per annum simple interest is:

  1. $Rs. 1325$
  2. $Rs. 1300$
  3. $Rs. 1350$
  4. $Rs. 1500$
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A Correct answer
AI explanation

Using the present worth formula, each installment of 702 is due in 0.5 and 1 year. The present worth of the first is 702 divided by 1.04, which is 675, and the present worth of the second is 702 divided by 1.08, which is 650. Adding these gives the total present worth of 675 + 650 = 1325. The present worth is Rs. 1325.

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