Mary bought a new car for €20 000 on the 1st July 2010 - Leaving Cert Mathematics - Question 7 - 2014

First, calculate the amount Mary needs to borrow:

$$Balance = Cost ext{ }of ext{ }New ext{ }Car - Trade-in ext{ }Value = 24000 - 10500 = 13500$$

Next, calculate the repayment amount after one year using the formula:

$$Repayment = Principal imes (1 + Rate)$$

Applying the interest rate:

$$Repayment = 13500 imes (1 + 0.115) = 13500 imes 1.115 = 15052.50$$

Thus, Mary would repay €15,052.50 on 1st July 2015.

First, calculate the total amount borrowed:

$$Loan = Cost ext{ }of ext{ }New ext{ }Car - Trade-in ext{ }Value = 24000 - 10000 = 14000$$

Next, calculate the amount to be repaid after making a payment of €4000 after six months:

$$Remaining ext{ }Loan = 14000 - 4000 = 10000$$

Next, calculate the interest for the remaining 6 months at a rate of 1.5% per month:

Using the formula:

$$Total ext{ }Repayment = Principal imes (1 + Rate)^{Months}$$

Calculating the compound interest:

$$Total ext{ }Repayment = 10000 imes (1 + 0.015)^6 = 10000 imes (1.093443) = 10934.43$$

Thus, Mary would repay €10,934.43 on 1st July 2015.

To determine which option is more cost-effective, we compare the total repayments:

• Total repayment for Buy Right: €15,052.50
• Total repayment for Bargain Deals: €10,934.43

The difference between the two options is:

$$Difference = 15052.50 - 10934.43 = 118.07$$

Thus, Mary would pay less overall if she chose Bargain Deals, saving her €118.07.