Question

Question 11 sto wants to buy a small wine form worth Re 500.00 he plans to Sell his current home For R3 400 00 which he will use as a deposit for the purchase of the form. He becure toan with a bank with a repayment period of 10 years and a internet roke of 9,5% Compounded monthly. Calcurate bre monthly repayments​

Answer 1

It is not clear what currency is being used in the question, so we will assume it is South African rand (ZAR) based on the use of the symbol "Re".

The loan amount is the purchase price of the small wine farm minus the deposit:
Loan amount = 50000 - 3400000 = -3350000 ZAR

Note that the loan amount is negative because the borrower owes the bank money.

The monthly interest rate is the annual interest rate divided by 12:
Monthly interest rate = 9.5% / 12 = 0.007917

The total number of payments over 10 years is 10 x 12 = 120.

Using the formula for monthly loan payments, we get:

Monthly payment = (P x r) / (1 - (1 + r)^-n)

Where P is the loan amount, r is the monthly interest rate, and n is the total number of payments.

Plugging in the values, we get:

Monthly payment = (-3350000 x 0.007917) / (1 - (1 + 0.007917)^-120) = 39779.50 ZAR

Therefore, the monthly repayment is approximately 39,779.50 ZAR.