Question

A flat screen television costs $2000 cash. If bought on hire purchase, a consumer must make a deposit of $900 followed by 12 monthly payments of $120. How much can be saved if the television is bought at the cash price?​

Answer 1

Answer:

$Amount = \ 340$

Explanation:

Given

$Cost\ Price=\ 2000$

On hire-purchase:

$Deposit = \ 900$

$Monthly\ Pay = \ 120$

$Months =12$

Required

Determine the amount to be saved if the item is bought outrightly

First, we calculate the total payment on hire-purchase:

$Total = Deposit + Monthly\ Pay * Months$

$Total = \ 900+ \ 120*12$

$Total = \ 900+ \ 1440$

$Total = \ 2340$

Subtract the cost price:

$Amount = Total - Cost\ Price$

$Amount = \ 2340 - \ 2000$

$Amount = \ 340$

The amount to be saved is $340