Question

the cash price for a car is 300000. the hire purchase price is a deposit of 80 000 and instalment of 2 500 for 3 years. how much more than the cash price is the hire purchase price​

Answer 1

To calculate the total amount payable under a hire purchase agreement, we need to add up the deposit and all the instalments.

The deposit is given as 80,000.

The number of instalments over the three-year period is:

3 years x 12 months/year = 36 months

So, the total cost of the car under the hire purchase agreement is:

80,000 + (2,500 x 36) = 170,000

To determine how much more the hire purchase price is than the cash price, we can subtract the cash price from the hire purchase price:

170,000 - 300,000 = -130,000

So, the hire purchase price is 130,000 less than the cash price. This means that the cash price is 130,000 higher than the hire purchase price.