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Disadvantages of Hire Purchase System: (1) Higher Price: A buyer has to pay higher price for the article purchased which includes cost plus interest. The rate of interest is quite high. (2) Artificial Demand: Hire purchase system creates artificial demand for the product. The buyer is tempted to purchase the products, even if he does not need

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A hire purchase (HP), also known as an installment plan, is an arrangement whereby a customer agrees to a contract to acquire an asset by paying an initial installment (e.g., 40% of the total) and repays the balance of the price of the asset plus interest over a period of time.Other analogous practices are described as closed-end leasing or rent to own.

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Hire Purchase vs Cash Purchase: Which Is Better

Some people believe that the higher a product is priced, the more likely it is that people will want to buy it. Some individuals argue that a product set with a dramatic price, it indicates the people intend to purchase it. In the essay, the influence of price and reasons which affect people desire to purchase …

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Essay On Higher Purchase

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