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Learning Intention

Loans & Hire Purchase. Learning Intention. Success Criteria. To know the meaning of the term HIRE PURCHASE and the term LOAN and their difference. To understand the term Hire Purchase and the term loan and their difference. Apply knowledge to calculations. Loans & Hire Purchase. 1-Sep-14.

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Learning Intention

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  1. Loans & Hire Purchase Learning Intention Success Criteria • To know the meaning of the term HIRE PURCHASE and the term LOAN and their difference. • To understand the • term Hire Purchase and the term loan and their difference. • Apply knowledge to calculations.

  2. Loans & Hire Purchase 1-Sep-14 Hire Purchase : When you pay for goods by putting down a deposit and then paying the rest up in small fixed payments over a period of time. Loan : Borrow money normally from Bank. Normally you pay more for the goods using these methods.

  3. Loans & Hire Purchase 1-Sep-14 Buying Products Washing Machine Cash Price £365.50 or by H.P. £75 deposit + 12 Payment £28.80 How much more do you pay by using Hire Purchase Total H.P. price = + 12 x £28.80 = £420.60 £75 Difference in price = £420.60 - £365.50 = £55.10

  4. Deposit 10% of £120 120 ÷ 10 = £12 Buying Products Hoover Cash Price £120 or by H.P. 10% deposit + 12 Payment £11 How much more do you pay by using Hire Purchase Total H.P. price = + 12 x £11 = £144 £12 Difference in price = £144 - £120 = £24

  5. Loans & Hire Purchase 1-Sep-14 • Sean’s bank offer to lend him £1499 to be paid back • in 12 instalments of £134.50. • What is his total repayment? • (b) How much does the bank charge him for the loan? Total Repayment = 12 x £134.50 = £1614 Charge for loan = £1614 - £1499 = £115

  6. Exercise 4.1, p67 1-Sep-14

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