While walking in a park, one morning, I found a Hundred Rupee note on one of the park benches. I picked it up, noted the number and took it home.

In the afternoon the plumber called on me to collect his bill. As I had no other moey at home, I settled his account with the Hundred Rupee note that I had found.

Later I came to know that the plumber paid the note to his milkman to settle his monthly account , who paid it to his tailor for the garments he had made.

The tailor in turn used the money to buy an old sewing machine, from a woman who lives in my neighbourhood. This woman incidentally, had borrowed Hundred Rupees from me sometime back to buy some household appliance. She, remembering that she owed me a Hundred Rupees, came and paid the debt.

I recognized the note as the one that I had found on the park bench, and on careful examination, I discovered that the note was counterfeit.

How much was lost in the whole transaction and by whom ?

(In reply to re: The solution by Ravi Raja)

Yes, I also agree that the net loss to those persons is zero, but didn't see how that was concluded from the interpretation "We can also say that all the transactions carried out through the counterfeit note are invalid". The puzzle assumes that the tailor still owns the sewing machine, rather than being treated as fraudulent ownership.

My only disagreement with the overall "no net change" is that indeed, the woman is no longer in possession of the sewing machine she once had, and the narrator has had his debt to the plumber paid off. Thus the woman's debt to the narrator has been paid off, by in effect paying one of the narrator's bills.

Posted by Charlie on 2003-04-16 05:07:39