Gce Model Questions Vol1 2024 Commerce Question 16
Practice objective / multiple choice question 16 from the 2024 Gce Model Questions Vol1 Commerce examination.
An entrepreneur wishes to discount a 180‑day bill of exchange with a face value of \(\text{₦}10{,}000\). The bank offers a discount rate of 20% per annum calculated on a discount basis (i.e., Discount = rate \(\times\) face value \(\times\) \(t/365\)). The entrepreneur requires that the amount he receives after discount be at least \(\text{₦}9{,}500\).\n\n(a) What is the greatest number of days, \(t\), for which the bill can be discounted while still meeting his requirement?\n\n(b) For that discount period, calculate the effective annual interest rate that the bank is earning on the amount actually received.
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About This Question
This is Gce Model Questions Vol1 2024 Commerce Question 16. It is one of the objective questions from the 2024 Gce Model Questions Vol1 Commerce examination.
Difficulty level: Medium .
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