# Robson ▸ Little Red Book ▸ Hire Purchase Charges

## Chapter 3 - Question 11

Given the cash price of an item together with the percentage rate required, calculate the HP charges for a given repayment.

### Solution 1

I had no idea how hire purchasing works, so I had a look round the web for some information. As far as I can tell a total price is agreed upon and then the buyer pays equal amounts every month until they reach that amount. They usually pay a deposit, but the question doesn't mention that so I wont include that part of the deal.

I'm not certain that's how it works, but I can always update my answer if I discover it works differently.

`<?` `    // a random cash price of an item in pounds` `    \$cash_price = mt_rand(5, 20);` `    // a random percentage rate` `    \$percentage_rate = mt_rand(5, 50);` `    // a random number of repayment periods` `    \$repayments = mt_rand(2, 10);` `    ` `    // the total amount to pay is the cash price plus the percentage` `    \$total = \$cash_price + (\$cash_price * (\$percentage_rate / 100));` `    ` `    // the amount to pay each month is the total amount` `    // divided by the number of repayments` `    \$repayment = \$total / \$repayments;` `    ` `    // output the original values` `    echo   . number_format(\$cash_price, 2) . '<br/>'` `         . 'Percentage Rate: ' . \$percentage_rate . '%<br/>'` `         . 'Repayments: ' . \$repayments;` `         ` `    // output the total amount to be paid     ` `    echo . number_format(\$repayment, 2) . '</b>';` `?>`

Which produces:

Cash Price: £15.00
Percentage Rate: 24%
Repayments: 9

Monthly Amount: £2.07

## Log

• Novemember 6, 2005 - Added solution 1.
© 2004-20 robson | cc unless stated