Credit agreements
Finding a deposit
A credit agreement is a popular way of buying expensive goods. Using a credit agreement you usually pay a deposit first and the remainder by monthly instalments. Goods normally cost more on a credit agreement.
Example
Tom wants to buy a TV through a credit agreement. He has been asked to make a deposit of one fifth of the total price of \(\pounds200\).
How much will the deposit be?
Deposit \(= \frac{1}{5}\) of \(\pounds200\)
\(= \frac{200}{5}\)
\(= \pounds40\)
Tom needs to make a deposit of \(\pounds40\).
Now find the deposit for each of the following:
Question
How much will a deposit of \(15\%\) of \(拢300\) be?
\(Deposit = 15\%\,of\,\pounds30\)
\(= 15 \times 1\%\,of\,\pounds300\)
\(= 15 \times 3\)
\(= \pounds45\)
The deposit will be \(\pounds45\).
Question
How much will a deposit of \(\frac{1}{4}\) of \(\pounds300\) be?
Deposit \(= \frac{1}{4}\) of \(\pounds300\)
\(= \frac{{300}}{4}\)
\(= \pounds75\)
The deposit will be \(\pounds75\).
Question
How much will a deposit of \(20%\) of \(拢500\) be?
Deposit \(= 20% of 拢500\)
\(= \frac{{500}}{5}\) (because \(20%\) is the same as \(\frac{1}{5}\))
\(= \pounds100\)
The deposit will be \(\pounds100\).