Question

Riah wants to buy a car that costs R125 000. The deposit is R29 00 .the bank charges a once off fee of R1 140; added to the loan amount before the interest is calculated at 9;75% coumpoud per year. The administration fee is R57 per month

1. What is the total amount of the loan that Riah has to get from the bank???

2. Write down the amonth of her monthly payment if it is R2 052; 01 plus the administration fee

3. What is the total amount she will have paid back after 5 years? ?

4. How much interest did she pay??

5 .how mush did the car cost in total? ?

here R is the simble of Currency same as dollar $

Answer 1

1		R
	Cost of car	125,000.00
	Less: Deposit	(2,900.00)
		122,100.00
	Add: bank charges	1,140.00
	Total loan amount	123,240.00

Month	Monthly payment	Administration fees	Interest at 9.75% compound per year	Principal Repayment	Ending loan outstanding
0					123,240.00
1	2,052.01	57.00	1,001.33	1,050.69	122,189.32

		R
3	Total loan repayment for 5 years (R 2052.01 x 12 months x 5 years)	123,120.60
	Total administration fee payable (R57 x 12 months x 5 years)	3,420.00
	Total amount paid back after 5 years	126,540.60
4	Total amount paid back	126,540.60
	Less: Loan amount	-123240
	Total interest and charges	3,300.60
5	Total amount paid back to the bank	126,540.60
	Add: Deposit paid at the beginning	2900
	Total cost of car	129,440.60