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Ram takes a loan of ₹5,00,000 from a bank at an interest rate of 6% per annum for 10 years. He wants to pay back the loan in equated monthly installments, then his EMI by using flat rate method is :

Solution

✅ Correct Option: 1

Flat rate interest =500000×0.06×10=₹300000= 500000 \times 0.06 \times 10 = ₹300000.

Total repayable =500000+300000=₹800000= 500000 + 300000 = ₹800000 over 10×12=12010\times12 = 120 months.

EMI=800000120=₹6666.67EMI = \dfrac{800000}{120} = ₹6666.67.

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