A student purchases a cell phone priced at by paying interest and making six
monthly instalments. What is the amount of interest paid and how much is each instalment?
A vehicle is offered for sale at a cash price of

To calculate the total interest paid on the cell phone, you’ll want to first find out the interest amount on the purchase price. The interest for one year on the cell phone would be of , which equals . Since the payment is made in six monthly instalments, you’ll divide the total amount paid (purchase price + interest) by the number of instalments to determine each payment. Thus, the total amount you’ll pay would be , and each instalment would be .

When it comes to the vehicle priced at , if a similar financing method is considered with a interest rate, you can apply the same principles to estimate costs. Just like the phone, calculate of to find the interest, which would be . Adding this to the vehicle’s cash price gives a total of , which can then be divided by the number of instalments for monthly payment calculations. Finances can feel overwhelming, but breaking things down into manageable parts makes them more approachable!