Meaning of "payment plan"

[Thao]

English Idioms and Expressions, Advanced Level

ESL/EFL Test #26 "Retail Sales Expressions", question 1

I went to BuyLots and bought a computer on hire purchase.

(a) payment in cash
(b) discount payment
(c) payment plan
(d) price increase

English Idioms and Expressions, Advanced Level

ESL/EFL Test #26 "Retail Sales Expressions", answer 1

I went to BuyLots and bought a computer on payment plan.

Correct answer: (c) payment plan

Your answer was: incorrect
I went to BuyLots and bought a computer on discount payment.
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what does it mean "payment plan"?

Thao

[Alan]

Hi Thao,

If you buy something on hire purchase/payment plan, you pay for it over a period of time say 1 year. Each month you pay a portion of the price of what you have bought until the full price is paid.

Alan
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