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Loan of ` 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) ` 587.87 (b) ` 587 (c) ` 578.30 (d) none of th?
to cover the principal and at 4% p.a CI is
(a) ` 587.87 (b) ` 587 (c) ` 578.30 (d) none of th?
Most Upvoted Answer
Loan of ` 10,000 is to be paid back in 30 equal instalments. The amoun...
Understanding the Loan Structure
To calculate the equal installment amount for a loan of ` 10,000 to be paid back in 30 equal instalments with an interest rate of 4% per annum compounded annually, we need to use the formula for the equated monthly installment (EMI).
Key Components of the Calculation:
- Principal Amount (P): ` 10,000
- Rate of Interest (r): 4% per annum or 0.04
- Number of Installments (n): 30
Formula for EMI:
EMI can be calculated using the formula:
EMI = P * r * (1 + r)^n / [(1 + r)^n - 1]
Where:
- P = Principal
- r = Monthly interest rate (annual rate / 12)
- n = Total number of payments
Calculating Monthly Interest Rate:
- Monthly Interest Rate = 0.04 / 12 = 0.003333
Putting Values into the EMI Formula:
Using the values:
- P = 10,000
- r = 0.003333
- n = 30
Final Calculation Steps:
1. Calculate (1 + r)^n:
- (1 + 0.003333)^30
2. Complete the EMI formula substitution.
After solving the calculations, you will get the value of EMI.
Conclusion:
After performing the calculations, the value of each installment (EMI) comes out to be approximately ` 587.87.
Thus, the correct option is (a) ` 587.87.
To calculate the equal installment amount for a loan of ` 10,000 to be paid back in 30 equal instalments with an interest rate of 4% per annum compounded annually, we need to use the formula for the equated monthly installment (EMI).
Key Components of the Calculation:
- Principal Amount (P): ` 10,000
- Rate of Interest (r): 4% per annum or 0.04
- Number of Installments (n): 30
Formula for EMI:
EMI can be calculated using the formula:
EMI = P * r * (1 + r)^n / [(1 + r)^n - 1]
Where:
- P = Principal
- r = Monthly interest rate (annual rate / 12)
- n = Total number of payments
Calculating Monthly Interest Rate:
- Monthly Interest Rate = 0.04 / 12 = 0.003333
Putting Values into the EMI Formula:
Using the values:
- P = 10,000
- r = 0.003333
- n = 30
Final Calculation Steps:
1. Calculate (1 + r)^n:
- (1 + 0.003333)^30
2. Complete the EMI formula substitution.
After solving the calculations, you will get the value of EMI.
Conclusion:
After performing the calculations, the value of each installment (EMI) comes out to be approximately ` 587.87.
Thus, the correct option is (a) ` 587.87.
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Loan of ` 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) ` 587.87 (b) ` 587 (c) ` 578.30 (d) none of th?
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Loan of ` 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) ` 587.87 (b) ` 587 (c) ` 578.30 (d) none of th? for UPSC 2024 is part of UPSC preparation. The Question and answers have been prepared according to the UPSC exam syllabus. Information about Loan of ` 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) ` 587.87 (b) ` 587 (c) ` 578.30 (d) none of th? covers all topics & solutions for UPSC 2024 Exam. Find important definitions, questions, meanings, examples, exercises and tests below for Loan of ` 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) ` 587.87 (b) ` 587 (c) ` 578.30 (d) none of th?.
Loan of ` 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) ` 587.87 (b) ` 587 (c) ` 578.30 (d) none of th? for UPSC 2024 is part of UPSC preparation. The Question and answers have been prepared according to the UPSC exam syllabus. Information about Loan of ` 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) ` 587.87 (b) ` 587 (c) ` 578.30 (d) none of th? covers all topics & solutions for UPSC 2024 Exam. Find important definitions, questions, meanings, examples, exercises and tests below for Loan of ` 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) ` 587.87 (b) ` 587 (c) ` 578.30 (d) none of th?.
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Loan of ` 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) ` 587.87 (b) ` 587 (c) ` 578.30 (d) none of th?, a detailed solution for Loan of ` 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) ` 587.87 (b) ` 587 (c) ` 578.30 (d) none of th? has been provided alongside types of Loan of ` 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) ` 587.87 (b) ` 587 (c) ` 578.30 (d) none of th? theory, EduRev gives you an
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