Johan wants to buy a car on hire purchase for N$49000 at the rate of 12% p.a. repayable using monthly installments for a period of 3 years and 4 months. (No deposit was required).

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

b) Monthly installment to be paid by George.

Bank 1 offered him 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 12% p.a. whereas Bank B offered to reduce the rate by 1.5% p.a.

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

d) Monthly installment to be paid by George to Bank 1.

Answer rating: 100% (QA)

Monthly payment amount for this hire purchase may be calculated through the following formula Monthly payment P 11r n r Where P Principal Amount r Mon... View the full answer