Equated Annual Installment = Loan Amount/PVIF(Interest&Time Period)
Ex : Loan Amount Rs. 5,00,000
Interest Rate 8%
Time period 5 equal instalments
The Answer will be EAI = 5,00,000/PVIF(8%.5)
This Implies EAI = 5,00,000/3.9927
The Answer will be EAI = 1,25,228.20
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I = (P x T x R)/100
(Face Value of Note) x (Annual Interest Rate) x (Time in Terms of One Year) = Interest
Annual interest is interest that accumulates every year. This is a predetermined percentage that is added to a loan or credit card payment.
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A measure of the cost of credit expressed as a yearly interest rate.