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A loan of Rs. 10.000 is to be paid back in 30 equal instalments. The amount of each installment to cover the principal and at 4% p.a. CI is
- a)Rs. 587.87
- b)Rs. 587
- c)Rs. 578.87
- d)None of these
Correct answer is option 'C'. Can you explain this answer?
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A loan of Rs. 10.000 is to be paid back in 30 equal instalments. The a...
Calculation of Equal Installment Amount
- The loan amount is Rs. 10,000.
- The loan is to be paid back in 30 equal instalments.
- Let the equal installment amount be x.
- The interest rate is 4% per annum.
- The interest is compounded annually.
Using the formula for the present value of an annuity, we can calculate the equal installment amount as follows:
Present value of an annuity = (Equal installment amount x [1 - (1 + r)^-n]) / r
where r is the interest rate per period and n is the number of periods.
In this case, r = 4% per annum = 0.04/12 per month (since there are 12 months in a year), and n = 30 months.
Substituting these values, we get:
Present value of an annuity = (x x [1 - (1 + 0.04/12)^-30]) / (0.04/12)
Solving for x, we get:
x = [10000 x (0.04/12)] / [1 - (1 + 0.04/12)^-30]
x = 578.87 (rounded off to two decimal places)
Therefore, the amount of each installment to cover the principal and at 4% p.a. CI is Rs. 578.87.
- The loan amount is Rs. 10,000.
- The loan is to be paid back in 30 equal instalments.
- Let the equal installment amount be x.
- The interest rate is 4% per annum.
- The interest is compounded annually.
Using the formula for the present value of an annuity, we can calculate the equal installment amount as follows:
Present value of an annuity = (Equal installment amount x [1 - (1 + r)^-n]) / r
where r is the interest rate per period and n is the number of periods.
In this case, r = 4% per annum = 0.04/12 per month (since there are 12 months in a year), and n = 30 months.
Substituting these values, we get:
Present value of an annuity = (x x [1 - (1 + 0.04/12)^-30]) / (0.04/12)
Solving for x, we get:
x = [10000 x (0.04/12)] / [1 - (1 + 0.04/12)^-30]
x = 578.87 (rounded off to two decimal places)
Therefore, the amount of each installment to cover the principal and at 4% p.a. CI is Rs. 578.87.
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A loan of Rs. 10.000 is to be paid back in 30 equal instalments. The amount of each installment to cover the principal and at 4% p.a. CI isa)Rs. 587.87b)Rs. 587c)Rs. 578.87d)None of theseCorrect answer is option 'C'. Can you explain this answer?
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A loan of Rs. 10.000 is to be paid back in 30 equal instalments. The amount of each installment to cover the principal and at 4% p.a. CI isa)Rs. 587.87b)Rs. 587c)Rs. 578.87d)None of theseCorrect answer is option 'C'. Can you explain this answer? for CA Foundation 2025 is part of CA Foundation preparation. The Question and answers have been prepared according to the CA Foundation exam syllabus. Information about A loan of Rs. 10.000 is to be paid back in 30 equal instalments. The amount of each installment to cover the principal and at 4% p.a. CI isa)Rs. 587.87b)Rs. 587c)Rs. 578.87d)None of theseCorrect answer is option 'C'. Can you explain this answer? covers all topics & solutions for CA Foundation 2025 Exam. Find important definitions, questions, meanings, examples, exercises and tests below for A loan of Rs. 10.000 is to be paid back in 30 equal instalments. The amount of each installment to cover the principal and at 4% p.a. CI isa)Rs. 587.87b)Rs. 587c)Rs. 578.87d)None of theseCorrect answer is option 'C'. Can you explain this answer?.
A loan of Rs. 10.000 is to be paid back in 30 equal instalments. The amount of each installment to cover the principal and at 4% p.a. CI isa)Rs. 587.87b)Rs. 587c)Rs. 578.87d)None of theseCorrect answer is option 'C'. Can you explain this answer? for CA Foundation 2025 is part of CA Foundation preparation. The Question and answers have been prepared according to the CA Foundation exam syllabus. Information about A loan of Rs. 10.000 is to be paid back in 30 equal instalments. The amount of each installment to cover the principal and at 4% p.a. CI isa)Rs. 587.87b)Rs. 587c)Rs. 578.87d)None of theseCorrect answer is option 'C'. Can you explain this answer? covers all topics & solutions for CA Foundation 2025 Exam. Find important definitions, questions, meanings, examples, exercises and tests below for A loan of Rs. 10.000 is to be paid back in 30 equal instalments. The amount of each installment to cover the principal and at 4% p.a. CI isa)Rs. 587.87b)Rs. 587c)Rs. 578.87d)None of theseCorrect answer is option 'C'. Can you explain this answer?.
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A loan of Rs. 10.000 is to be paid back in 30 equal instalments. The amount of each installment to cover the principal and at 4% p.a. CI isa)Rs. 587.87b)Rs. 587c)Rs. 578.87d)None of theseCorrect answer is option 'C'. Can you explain this answer?, a detailed solution for A loan of Rs. 10.000 is to be paid back in 30 equal instalments. The amount of each installment to cover the principal and at 4% p.a. CI isa)Rs. 587.87b)Rs. 587c)Rs. 578.87d)None of theseCorrect answer is option 'C'. Can you explain this answer? has been provided alongside types of A loan of Rs. 10.000 is to be paid back in 30 equal instalments. The amount of each installment to cover the principal and at 4% p.a. CI isa)Rs. 587.87b)Rs. 587c)Rs. 578.87d)None of theseCorrect answer is option 'C'. Can you explain this answer? theory, EduRev gives you an
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