This key homework is designed to incorporate what you have learnt in lessons this term in an

applied situation.

The task you have been given is that four people need to purchase a car for different reasons. None
of these four have the money readily available to them so they have to take out a loan to finance the
car. You have to decide which loan they should take out and which car they should buy based on
their income and their credit rating

You will have to first create a budget sheet based on the information given to you about the four
people to see how much money per month they can afford to spend on repaying a loan

You will then have to look at what loan they should take out based on their credit rating and how
much money they have available to spend per month.

You then need to make a decision on what loan each person should take out to buy their car. You
MUST give reasons for this decision. There is not one correct answer, it is open to your own
interpretation

DATE SET DATE DUE (or before)

Name: Tamsin Long Name: Sadie Latini
Age: 18 Age: 24

Background: Left school at 16 with 4 GCSEs Background: Left university two years ago
Lives with parents. with a degree in journalism.
Spends a lot on clothes and She is in a shared flat with a
clubbing friend, stays in during the week,
.
Job: Trainee Hairdresser Job: Journalist

Gross Gross
Income: £9000 Income: £18000

Monthly Rent: £200 (all in) Monthly Rent: £300

Outgoings: Travel: £30 Outgoings: Bills: £70
Credit card: £25 Travel: £5
Mobile phone: £30 Student loan: £85
Other: £45 Pension: £80
Mobile phone: £45
Other: £45

Reasons for car: Wants to be more
independent, also she’ll be
the first from her friends to
have one.
Reasons for car: Needs it for work to
improve her contact base
which will help her to
become a better journalist
and hence get promoted.

Credit rating: Excellent Credit rating: Excellent

Name: DJ Spinsta Name: Michael Thomas

Age: 18 Age: 19

Background: Left school at 16 with no Background: Left school with a GNVQ.

qualifications Lives in a shared house with
Lives with parents. four friends from college
Spends a lot on music
. Job: Journalist
Job: Part time in record shop
Gross
Gross Income: £12000
Income: £6000
Monthly Rent: £220
Monthly Rent: £100 Outgoings: Bills: £40
Outgoings: Travel: £0 Travel: £15
Loan: £60 Mobile phone: £20
Mobile phone: £40 Saving for travelling : £75
Other: £45

Reasons for car: Wants to look the part Reasons for car: To get around.

Credit rating: Good Credit rating: Poor

 CAR 1 CAR 2

Price: £500 Price: £2000

Mileage: 180,000 Mileage: 90,000

Age: 18 years Age: 12 years

Comment: It will get you from Comment: Good little runner,

A to B. drives well and is
(most of the time) very reliable.
Basic interior.

CAR 3 CAR 4

Price: £12000
Price: £5000
Mileage: 11,000
Mileage: 25,000
Age: 2 years
Age: 6 years
Comment: Stylish wheels for a
Comment: Very comfortable stylish life style.
car. All the This car is set to turn
necessities in a hot heads as you cruise
day, electric through the streets
windows, air con etc with the top down.
Task 2 – Credit Scoring
(This will be assessed on the citizenship criteria found on the back page)

What is a credit rating?

Where can you find out about it?
Why do people have good and bad ratings?

If you need more paper

please attach an extra sheet
Task 3
For each car calculate how much you would have to repay at the given interest rate over the given
time period

Levels for task 3

If you show that you can calculate a “simple” percentage with the use of the calculator (you still
need to show workings) then this will secure a Level 5

If you show that you can calculate a “simple” percentage without the calculator (you will need to
show detailed workings of calculations) then this will secure a Level 6

If you show that you can calculate a “compound” percentage with or without the calculator (you
will need to show workings of stages of calculations) then this will secure a Level 7/8

TOTAL REPAYMENT

Credit Interest rate Car 1 Car 2 Car 3 Car 4

Rating (£500) (£2000) (£5000) (£12000)

Excellent 8% for 4 years

Excellent 11% for 3 years

Good 15% for 4 years

Good 21% for 2 years

Poor 20% for 5 years

Poor 29% for 3 years

How much does this work out as a single monthly repayment?

MONTHLY REPAYMENT

Interest rate Car 1 Car 2 Car 3 Car 4

Excellent 8% for 4 years (48 months)

Excellent 11% for 3 years (36 months)

Good 15% for 4 years (48 months)

Good 21% for 2 years (24 months)

Poor 20% for 5 years (60 months)

Poor 29% for 3 years (36 months)

Task 4
Each person needs to buy a car. To buy a car they must take out a loan

You must decide on what car each person can buy. You need to show consideration for their credit
rating as well as their disposable incomes

Assessment Criteria
 This work will be assessed under three criteria, two mathematics related
criteria and one citizenship related criteria.
Please read the criteria to ensure that you gain the highest level possible.

MATHEMATICS CRITERIA SECTION 1- NUMBER

LEVEL CRITERIA ACHIEVED

I have shown that I can add and subtract three and four
3
digit numbers using a written method.
I have shown that I can use a calculator to calculate
4 multiple stepped calculations involving the four basic
operations.
I have shown that I can use a calculator to find
5
percentages of amounts
I have shown that I can find percentages of amounts
6
without using a calculator
7/8 I have shown that I can calculate compound interest

MATHEMATICS CRITERIA SECTION 2-USING AND APPLYING

LEVEL CRITERIA ACHIEVED

I have used the appropriate mathematics processes

3 throughout the project although there may be errors in
these processes.
I have presented my results in a clear and organised
4 way throughout the whole investigation. All my
workings are easy to follow and their purpose is clear
I have shown that I can select the appropriate
5 information to carry out the required calculations
throughout this project
I have presented a concise, reasoned argument and
6 discussed in detail reasoning for my choices of which
loan is best for each person

CITIZENSHIP CRITERIA
LEVEL CRITERIA ACHIEVED

1 I can talk about what a credit rating is.

I can talk about the differences between a good credit
2
rating and a poor credit rating
I can investigate about what a credit rating is if given
3
the sources to look through
I can find my own sources on credit ratings and make
4
comments about what effects they can have
I can use different methods and sources of information
5 to explore about credit ratings, find out what others
think and draw my own conclusions
I can see why people have a range of opinions about
credit ratings and I can explain reasons for why people
6
think different things about them.