Help. calculation of effective rate

interest comes to approx 1.17% p.m.

(50000-10000)/12= 3333 p.m.

3800-3333= 467(Interest)

467/40000*100= 1.16%

3800 * 12 = 45600

interest 45600-40000 = 5600

 im not getting the effective int rate...

interest rate per annum is coming to 14%(5600/40000*100). so mnthly int is coming to 1.17% as calculated by above.

What is the problem that you are facing in calculating the effective int rate.

the question is from RTP MAY 2013 Q5

the effective interest rate is Coming 25.85%

samajh nahi aa raha kaise...

thanku sir for ur responses...

it is 25.85%

I tried hit and trial method

40000/12 =  3333.333

I calculated interest for evey month like for first month i used 12 month interest

for next payment i used 11 month interest

so on

total interest must be 5600 i.e.    45600-40000

so 25.85% came

thanku CA PRASHANT GUPTA &  GIRIDHAR

thanku

just went in a wrong direction to solve..

thanku sir for d reply..

Hi

You can check excel file for how to calculate.. Ans may vary case to case.

Thanks!!