Abusiswe loans R78 500 from a bank to buy a car. She agrees to repay the amount with interest in equal monthly instalments. The bank adds simple interest at a rate of $$ 7.5 \% $$ over 3 years to the amount. Calculate the following: 4.1 the total amount Abusiswe has to pay 4.2 the monthly instalments she has to pay

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We start by calculating the simple interest using the formula

$$
I = P \times r \times t
$$

where:
- $$ P = 78\,500 $$ (the principal)
- $$ r = 0.075 $$ (the annual interest rate)
- $$ t = 3 $$ (the time in years)

So,

$$
I = 78\,500 \times 0.075 \times 3 = 78\,500 \times 0.225 = 17\,662.5
$$

Thus, the simple interest is $$ 17\,662.5 $$.

Next, we find the total amount payable by adding the interest to the principal:

$$
\text{Total Amount} = P + I = 78\,500 + 17\,662.5 = 96\,162.5
$$

Now for the monthly instalments, since the loan period is 3 years, the number of months is

$$
\text{Months} = 3 \times 12 = 36
$$

The monthly payment is given by

$$
\text{Monthly Instalment} = \frac{\text{Total Amount}}{\text{Number of Months}} = \frac{96\,162.5}{36} \approx 2\,671.18
$$

Thus, the answers are:

- The total amount Abusiswe has to pay is $$ 96\,162.5 $$.
- The monthly instalments she has to pay are approximately $$ 2\,671.18 $$ per month.
Abusiswe has to pay a total of R96,162.50 and her monthly instalments are approximately R2,671.18.

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