EMI = [P x R x (1+R)^N]/[(1+R)^N-1] | ||||
Where, | ||||
EMI= Equal Monthly Payment | ||||
P= Loan Amount | ||||
R= Interest rate per period | ||||
N= Number of periods | ||||
= [ $120000x0.012 x (1+0.012)^300]/[(1+0.012)^300 -1] | ||||
= [ $1399.92( 1.012 )^300] / [(1.012 )^300 -1 | ||||
=$1444.44 | ||||
Monthly payment is $1444.51 | ||||
We need to calculate present value of remaing payments | ||||
Reamining payments = 10 years *12 =120 | ||||
Present Value Of Annuity | ||||
= C*[1-(1+i)^-n]/i] | ||||
Where, | ||||
C= Cash Flow per period | ||||
i = interest rate per period | ||||
n=number of period | ||||
= $1444.51[ 1-(1+0.0116666)^-120 /0.0116666] | ||||
= $1444.51[ 1-(1.0116666)^-120 /0.0116666] | ||||
= $1444.51[ (0.7514) ] /0.0116666 | ||||
= $93,034.48 |
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