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Rose wants to buy a car on hire purchase for N$75,000.00 at the rate of...

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Finance

Rose wants to buy a car on hire purchase for N$75,000.00 at the rate of 11% p.a. repayable using monthly installments for a period of 3 years and 10 months. (No deposit was required). Use the given information to calculate the:

(a) Total amount of money expected to be paid to the Hire Purchase Company over the years. (5)

(b) Monthly installment to be paid by Rose. (5)

c) Bank 1 offered her a loan repayable at a certain monthly installment for the same period of time as the car hire company at the rate same rate of 11% p.a. whereas Bank 2 offered to reduce the rate of by 1.5% p.a. What is the:

(i) Total amount of money expected to be received by Bank 1. (5)

(ii) Monthly instalment to be paid by Rose to Bank 1. (5)

(iii) Total amount of money expected to be received by Bank 2 using the reduced interest rate. (5)

(iv) Monthly installment to be paid by Rose to Bank 2. (5)

(v) How much money will Rose save per month using the cheapest option? (5)

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