Certainly! Let's break down each part of the question step-by-step based on the provided information and consider the result provided.
### 4.1.1. Define the term monthly repayments in the given context.
Monthly repayments refer to the fixed amount of money that a borrower must pay back to the lender every month. This amount includes both principal (the amount borrowed) and interest (the cost of borrowing the money) and continues until the entire loan is fully repaid.
### 4.1.2. Write down the loan factor that will be used to calculate the Mbona family's monthly repayments. Show calculations.
In this context, the loan factor is used to determine the monthly repayment amount per R1,000 of the loan. The interest rate given is 10.25%, and the loan period is specified as 25 years. From the provided table:
[tex]\[
\text{Interest rate} = 10.25\%
\][/tex]
For a loan period of 25 years, the corresponding loan factor from the table is:
[tex]\[
\text{Loan factor} = 9.26
\][/tex]
### 4.1.3. Determine the loan amount the Mbona family would pay for the house. You may use the formula:
[tex]\[
\text{Loan amount} = \text{Cash Price} - \text{Deposit}
\][/tex]
Given the following:
- Cash Price = R550,000
- Deposit = 20% of Cash Price
First, calculate the deposit:
[tex]\[
\text{Deposit} = 20\% \times \text{Cash Price} = 0.20 \times 550,000 = R110,000
\][/tex]
Now, subtract the deposit from the cash price to get the loan amount:
[tex]\[
\text{Loan amount} = \text{Cash Price} - \text{Deposit} = 550,000 - 110,000 = R440,000
\][/tex]
Thus, the loan amount the Mbona family would pay for the house is R440,000, and the loan factor to be used for calculating their monthly repayments is 9.26.
