Selling a bill in less than the face of the value for immediate cash before the due date is to?

Assessment: WAEC SSCE - Commerce - 1995 (Objective) Subject: Commerce

Question 1 Report

Selling a bill in less than the face of the value for immediate cash before the due date is to?
Answer Details
Selling a bill in less than the face value for immediate cash before the due date is known as "discounting the bill." Essentially, the holder of the bill sells the right to collect the full value of the bill to a third party, who pays the holder less than the full amount in cash. The third party then collects the full value of the bill when it comes due. Discounting a bill can provide the holder with immediate cash, but at the cost of receiving less than the full value of the bill.
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