A loan of Rs 400000 at the interest rate of 6.75% p.a. compounded monthly is to be amortized by equal payments at the end of each month for 10 years. Find the size of each monthly payment.
(Given $(1.005625)^{12}1201.9603, (1.005625)^{60}=1.4001)$
Answer & explanation
Correct answer: option 1
The correct answer is option (1) : ₹45493
Given $P= ₹400000$
$n=120$
$i=\frac{6.75}{1200}=0.005625$
$∴EMI=\frac{400000×0.005625×(1.005625)^{100}}{(1.005625)^{120}-1}$
$=\frac{400000×0.005625×1.9603}{0.9603}$
$=₹45493$