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  • Effective Rate of Interest

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    priyank shah
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    ASSET VALUE DOWN PAYMENT LOAN AMOUNT EMI 2434 LOAN PERIOD 24 EMI (2 YEAR) RATE OF RETURN 13.50% X 2 years X Rate of Interest = ACTUAL FLAT RATE OF INTEREST IS 17.47% EFFECTIVE RATE = 40% ANNUAL INSTALLMENT EQUIVALENT TO THE VALUE OF THE 12 MONTHLY INSTALMENT.

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    Effective rate of interest

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    ASSET VALUE DOWN PAYMENT LOAN AMOUNT EMI 2434 LOAN PERIOD 24 EMI (2 YEAR) RATE OF RETURN 13.50% X 2 years X Rate of Interest = ACTUAL FLAT RATE OF INTEREST IS 17.47% EFFECTIVE RATE = 40% ANNUAL INSTALLMENT EQUIVALENT TO THE VALUE OF THE 12 MONTHLY INSTALMENT.

    Copyright:

    Attribution Non-Commercial (BY-NC)
    Download as PPT or read online from Scribd
    Flag for inappropriate content
    58 views7 pages

    Effective Rate of Interest

    Uploaded by

    priyank shah
    ASSET VALUE DOWN PAYMENT LOAN AMOUNT EMI 2434 LOAN PERIOD 24 EMI (2 YEAR) RATE OF RETURN 13.50% X 2 years X Rate of Interest = ACTUAL FLAT RATE OF INTEREST IS 17.47% EFFECTIVE RATE = 40% ANNUAL INSTALLMENT EQUIVALENT TO THE VALUE OF THE 12 MONTHLY INSTALMENT.

    Copyright:

    Attribution Non-Commercial (BY-NC)
    Download as PPT or read online from Scribd
    Flag for inappropriate content
    of 7

    Submitted To: Submitted

    By:
    Sushil Mohanty Priyank Shah
    Dhimant Vyas
    ASSET VALUE 67695
    DOWN PAYMENT 24405
    LOAN AMOUNT 43290
    EMI 2434
    LOAN PERIOD 24 EMI (2 YEAR)
    RATE OF RETURN 13.50%
    Total Payment = 2434 X 24
    = 58416
    Interest = Loan Amt – Total
    Payment
    = 43290 – 58416
    = 15126
    43290 X 2 years X Rate of Interest =
    15126
    ACTUAL FLAT RATE OF
    INTEREST IS 17.47%
    2434 X 12 X I/d^12 X PVIFA
    (I,2) =43290

    EFFECTIVE RATE OF INTEREST =


    40%
    ANNUAL INSTALLMENT EQUIVALENT
    TO THE VALUE OF THE 12 MONTHLY
    INSTALLMENT

    =2434 X 12 = 29208
    I/d12= FOR 40% = 1.2055
    = 29208 X 1.2055 = 35210
    ANNUAL INTEREST REBATE = 35210 - 29208
    = 6002

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