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One off payment.

Vvedavyas15y ago
This is a doubt from Q12 page 13, answer 12 page 88 of the BPP revision kit.
Why is the one-off payment multiplied into 12% ? Why aren’t we considering the full cost ?
John MoffatJohn MoffatTutor15y ago#1
Because it is a one-off payment.

All the other costs and savings will happen each year, but the one-off payment only happens once.

So.....since we have an overdraft, a one-off payment will increase the overdraft and so there will be extra interest of 12% each year.
Vvedavyas15y ago#2
Is this something like a membership fee or a registration fee, that you pay once and do not pay again even if you were not to use the factor again ? Because I considered this one off payment as a yearly payment.
Thank You very much for your time and help.
John MoffatJohn MoffatTutor15y ago#3
Yes - thats correct. YOu pay once and then do not pay again.
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