Answer:
$30
Step-by-step explanation:
Total amount paid by the hire purchase scheme:
$60 + 6 * $45 = $60 + $270 = $330
Total amount paid in just the cash price:
$300
Difference:
$330 - $300 = $30
The original annual simple interest rate, rounded to two decimal places, is 3.79%
What is the formula for simple interest?
The simple interest on a loan or deposit is determined as the principal multiplied by the simple interest rate and time
I=PRT
The first loan:
P=12 850.00
R=r(assume it is r)
T=4 years
I=12 850.00*r*4
I=51400r
The second loan was taken after 14 quarters the first was taken out, which is the same as after 3.5 years, hence, the interest on the second loan is only for a half a year
P=3 273.00
R=0.5r( half of the interest on the first loan)
T=0.5 years
I=3 273.00*0.5r*0.5
I= 818.25r
Total interest=51400r+818.25r
Total interest=52218.25r
total interest paid=1 980.00
1 980.00=52218.25r
r=1 980.00/52218.25
r=3.79%
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