A bill of exchange paid before its due date at an amount less than its face value is said to have been

Answer Details

The correct option is "discounted". A bill of exchange is a financial instrument that is used to facilitate transactions between parties. It is a written order from one party (the drawer) to another party (the drawee) to pay a certain amount of money to a third party (the payee) at a future date. When a bill of exchange is "discounted", it means that the payee has sold the bill to a bank or a financial institution before its due date. The bank or financial institution will pay the payee an amount less than the face value of the bill (i.e., the amount that the drawee is supposed to pay at maturity), in exchange for the right to collect the full amount from the drawee at maturity. The difference between the face value of the bill and the discounted amount paid by the bank or financial institution is called the "discount". The discount represents the interest that the bank or financial institution will earn from the transaction. In summary, when a bill of exchange is "discounted", it means that the payee has sold the bill before its due date at a price less than its face value, in exchange for immediate payment.