Question

The cost of a set of home appliances is $Rs.36,000$. Siri wants to buy them under a scheme of $0\% $ interest and by paying $3$ EMI in advance. The firm charges $3\% $ as processing charges. Find the EMI and the total instalment for a period of $24$ months.

Answer 1

 Hint: Start by finding the number of instalments by taking the principal amount and dividing it by the total number of months. Then, find out the amount that has to be paid in advance by multiplying the value obtained in the previous step with the number of EMIs.
Given, cost of a set of home appliances, $\left( P \right) = Rs.36,000$
Now to calculate the instalments, we take the total cost and divide it with the number of total months.
Therefore,
Total number of instalments $ = \dfrac{P}{N} = 1500$
Now, to calculate the amount to be paid as advance will be calculated by taking the number of total instalments and multiplying it with the number of instalments which in this case is $3$.
Therefore,
The amount paid in advance $ = 1500 \times 3 = 4500$
Now, the next step is to calculate the processing charges,
Processing charge at the rate of $3\% $$ = \dfrac{{36000 \times 3}}{{100}} = 1080$

Note: Make sure you divide by 100 while calculating the processing charge as the rate is in percentage format.

The total amount to be paid will be the sum of the multiplication of total instalments and months with processing charges into $100$.
Therefore,
Total amount to be paid$ = 1500 \times 24 + 10800 = 36000 + 1080 = 37080$
Therefore, EMI is $Rs.1,500$ and total instalments is $Rs.37,080$