Ravi takes a loan of Rs. 40,000 at an interest of 12% per annum for a period of 4 year, then EMI by using flat method is :
Answer & explanation
Correct answer: option 2
The correct answer is Option (2) → Rs. 1233.33
In the flat rate method, interest is charged on the whole principal for the whole period, and the principal plus interest is repaid in equal monthly instalments.
Interest for 4 years:
\(I = 40000 \times 0.12 \times 4 = 19200\)
Total amount to repay:
\(40000 + 19200 = 59200\)
Number of monthly instalments: 4 × 12 = 48.
\( \displaystyle \text{EMI} = \frac{59200}{48} \)
\(= 1233.33\)
So the EMI is Rs. 1233.33.
CBSE Applied Mathematics (Class XII):
Methods of Calculation of EMI or Instalment
