How is an EMI calculated

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The total type of EMI is Equated Month-to-month Installment. An EMI is a kind of cost you need to make each month in a sure time frame to repay a mortgage or pay for one thing. The instalments are at all times equal as we are able to see within the identify.

To calculate the EMI you may take the assistance of a mathematical system. The system is,
EMI = P × r × (1 + r)n/[(1 + r)n – 1]
Right here, “P” stands for the quantity of mortgage, “r” stands for the speed of curiosity and “n” stands for the tenure in months.
The funds for EMI are inversely proportional to the tenure and straight proportional to the quantity of mortgage together with the speed of curiosity. If the speed of curiosity or the quantity of mortgage will get greater, the EMI to be paid will get greater too however the tenure will lower.

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