Kavya takes a personal loan of ₹10,00,000 at the rate of 12% per annum for 5 years, then the EMI by using flat rate method is
Answer & explanation
Correct answer: option 1
The correct answer is Option (1) → ₹26,666.66 **
Principal = ₹10,00,000
Rate = 12% per annum
Time = 5 years
Total interest = $P \times R \times T$
$= 1000000 \times 0.12 \times 5$
$= 600000$
Total amount to be repaid = $1000000 + 600000 = 1600000$
Total months = $5 \times 12 = 60$
EMI = $\frac{1600000}{60} = 26666.67$
The EMI using the flat rate method is ₹26,666.67.