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Maths I
Hire purchase
Often, using H.P you pay a deposit first and the remainder by monthly instalments. To calculate the total H.P. price you have to add together the deposit and the total of all of the instalments.
A new TV costs £690 cash. It is available on H.P. by paying a deposit of 15% followed by 12 instalments of £55.85.
Find the total H.P. price and the extra that you would pay (over the cash price) using H.P.
First we calculate the deposit:
Deposit = 15% of £690
= of 690
= 15 x 6.90
= £103.50
Now we need to calculate the total instalments:
Total instalments = £55.85 x 12
= £670.20
We can now find the total H.P. cost
H.P. cost = deposit + total instalments
= £103.50 + £670.20
= £773.70
Finally we work out the difference between the H.P price and the cash price
Extra paid = H.P. cost - cash price
= £773.70 - £690
= £83.70
A DVD player costs £240 cash. It is available on H.P. by paying a deposit of 20% followed by 12 instalments of £18.50. Find the extra paid by H.P.
First we calculate the deposit:
Deposit = 20% of £240
= 20 x 2.40
= £48.00
Now we need to calculate the total instalments:
Total instalments = £18.50 x 12
= £222.00
We can now find the total H.P. cost
H.P. cost = deposit + total instalments
= £48.00 + £222.00
= £270.00
Finally we work out the difference between the H.P price and the cash price
Extra paid = H.P. cost - cash price
= £270.00 - £240.00
= £30.00
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