Answer to Question #175562 in Financial Math for Shadrack Thabiso Tselanyane

Question #175562

Sabir is going to university to study to become a pharmacist.his father decided to buy him a new Toyota Augo as a reward for his wonderful grade 12 results.The Toyota Augo is currently on special for the reasonable price of R174 900 including VAT.They decided to buy the car on hire-purchase and pay of the balance in 60 montly installment.Simple interest is charged at a rate of 14% p.a. A deposit of 10% is required.what is the Loan amount after the deposit has been paid


1
Expert's answer
2021-03-29T14:14:14-0400

We will find the amount after the deposit is made:

174900174900×0.1=157410174 900-174 900\times0.1=157 410

Find the loan amount:

Monthly payment:

x=S×(r+r(1+r)n1)x=S\times(r+\frac{r}{(1+r)^n-1})

n=60

S= 157 410

r=0.1412=0.0117r=\frac{0.14}{12}=0.0117

x=S×(r+r(1+r)n1)=157410×(0.0117+0.0117(1+0.0117)601)=3662.66x=S\times(r+\frac{r}{(1+r)^n-1})=157 410\times(0.0117+\frac{0.0117}{(1+0.0117)^{60}-1})=3662.66

Find the loan amount:

3662.66×60=219759.323662.66\times60=219 759.32



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