Akhilesh Teri (Student) (102 Points)
10 February 2011i came across this que in my FM module and it is an illustratio, the solution is given but m unale to understand the solution:
Q. Ramanuj has taken a 20 month car loan of rs. 600000. the rate of interest is 12 percent per annum. what will be the amount of monthly loan amortization?
Ans. A=600000/PVIFA=600000/18.0456=rs. 33,249.1
monthly interest = 12 percent/12=1 percent
m unable to understand the whole concept of pvifa in this. pls help!!
Tehsinkhan Pathan
(CA CMA DISA(ICAI) B.COM)
(3956 Points)
Replied 10 February 2011
(1+i)n-1
PVIFA= ----------
i(1+i)n
WHERE, PVIFA=PRESENT VALUE INTEREST FACTOR ANNUITY
i=INTEREST RATE = 12/12=1%
n =20
BY APPLYNG THIS FORMULA YOU WOULD BE ABLE TO GET THE ANSWER......................
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