Neco 2025 Commerce Question 22

A telecom company offers a 24‑month contract for a smartphone at a monthly subscription of ₦4,500. The contract includes a one‑time activation fee of ₦2,500 and a mandatory insurance premium of 2% of the monthly fee added each month. The contract states that if the consumer terminates the agreement before completing 12 months, an early termination penalty equal to 25% of the total remaining monthly fees (excluding insurance) is charged. The consumer decides to cancel after 8 months. Determine the total amount the consumer has paid up to cancellation, including all fees and the early termination penalty, and also compute the average monthly cost incurred over the 8 months.