Mohini purchases a house worth Rs. 50 lakhs and makes a down payment of Rs. 11.2 lakhs. She pays the remaining amount on monthly EMI using a reducing balance method. The bank charges 6% per annum compounded monthly for a tenure of 25 years. Her EMI is: [Given: $(1.005)^{-300}≈ 0.224$]

Rs. 25000

The correct answer is Option (2) → Rs. 25000

Given: Price = Rs. 50,00,000, Down payment = Rs. 11,20,000

Loan (principal) $P = 50{,}00{,}000 - 11{,}20{,}000 = 38{,}80{,}000 = 3880000$

Monthly rate $i = \frac{0.06}{12} = 0.005$, number of months $n = 25\times12 = 300$

EMI formula: $EMI = \frac{P\,i}{1-(1+i)^{-n}}$

Substitute values: $EMI = \frac{3880000 \times 0.005}{1-(1.005)^{-300}}$

Using $(1.005)^{-300}\approx 0.224$ gives denominator $1-0.224=0.776$

$EMI = \frac{19400}{0.776} = 25000$

EMI = Rs. 25,000 per month