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Foundation November 2019 Paper 2 Q14

EduqasFoundationCurrent spec7 marksPercentages

14.

(a)

Estate agents help people sell their houses.
They charge people for the help that they provide.

Bilal plans to sell his house for £146 000.
He has a choice of these two estate agents:

Blue Blocks Estate Agent

Fixed Charge £1420 + 20% VAT		Sell ‘em Fast Estate Agent

Charge 1·25% of the selling price

Bilal wants to pay as little as possible to the estate agent.

Which estate agent should Bilal choose?

You must show all your working. [4]

(b)

Stamp duty is a tax that is paid when houses are purchased (bought).

For houses purchased up to £925 000, the stamp duty is calculated as follows:

  • 0% on the first £125 000 of the purchase price,
  • 2% on the next £125 000 of the purchase price,
  • 5% on the next £675 000 of the purchase price.

An example to calculate the stamp duty on a house with a purchase price £275 000.

Example
House purchased for £275 000, the stamp duty is calculated as follows:
0% on the first£125 000£0
2% on the next£125 000£2500
5% on the next£25 000£1250
Total stamp duty on£275 000£3750

Mr Evans is asked to pay stamp duty of £12 000 when he buys a new house.
He pays £380 000 for his new house.

Is the stamp duty he is asked to pay correct?

You must show all your working. [3]

Correct ☐     Incorrect ☐

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