Amayra takes a loan of Rs. 5,00,000 at an interest of 10% per annum for a period of three years. The equated monthly installment (EMI) by using flat rate method, she has to pay is:
Answer & explanation
Correct answer: option 4
The correct answer is Option (4) → Rs. 18,055.55
In the flat rate method, simple interest is charged on the whole principal for the full period, and the total is divided equally over the months:
\( \displaystyle \text{Interest}=P\times r\times t=500000\times 0.10\times 3=150000 \)
\( \displaystyle \text{Total amount}=500000+150000=650000 \)
\( \displaystyle \text{Number of instalments}=3\times 12=36 \)
\( \displaystyle \text{EMI}=\frac{650000}{36}=18055.55\ldots \)
So the EMI is Rs. 18,055.55.
CBSE Applied Mathematics (Class XII):
Methods of Calculation of EMI or Instalment
