THAT QUESTION OF PERCENTAGE.

Woodville Examiner, Volume XXI, Issue 3574, 6 July 1903, Page 2

THAT QUESTION OF PERCENTAGE.

[to the editor] . Sir, —With reference to your article re Jockey Club proposed loan, I wish to point out you are in error in stating that the amount proposed to be borrowed was at 3f per cent. No such representation was made, and surely no person who could think would conclude that mouey was available at such a low rate as per cent. After L had explained the system of re-payment to the members of the club, I stated that the interest to be paid for the 12 years would amount to less than 3j per cent, for the whole period. This is apparent, as payment at the rate of £3OO a year principal and interest would amount to £3OOO in twelve years, principal being £2500 and interest £llOO ; whereas interest on £2500 at 3f per cent, for 12 years would amount to £1125, being £25 more than would be paid under the instalment system, which is based on 6 per cent. What you should get you expert to work out, and which would be beneficial to your readers, would be the difference between a mortgage for a fixed term at say per cent, and the one under consideration where principal and interest is paid by instalments. Under the latter you would pay £3OO a year, the former £ll2 10s; invest the annual difference, £lB7 10s, at compound interest at a rata you could expect allowing for delays in investment, or invest it with a Bank where interest would commence as soon as money was available. Expecting the above proposition worked out in •next issue.—l am, &c., ■' E. J. Guimard.