Advertisements
Advertisements
Question
What is the main advantage of Discounting Bills of Exchange for the seller?
Options
Immediate availability of funds
No need to pay interest
High loan amount
Flexibility in repayment terms
MCQ
Advertisements
Solution
Immediate availability of funds
Explanation:
By discounting a bill, the seller sells the credit instrument to a bank for cash before its maturity. The bank pays immediately (minus a discount/charge), giving the seller quick liquidity.
shaalaa.com
Is there an error in this question or solution?
