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Name: __________________________________________ Date: _____________________

College: ________________________________________ Class of ___________________




Monday, October 27, 2014
Simple Interest
Interest is money earned on a savings account or an investment. It can also be extra money that
you pay for borrowing money. When you deposit money in a savings account, for instance, the
bank pays you interest on the money. The interest rate is the rate at which your money earns
interest in a given amount of time.


















































































What do all of the images above have to do with interest rates? Do any of
them demonstrate interest in a positive way? Is interest a good thing or a
bad thing?

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Banks and credit card companies make money by.
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Terms: - Interest - Interest Rate - Principal
Vocabulary:
______________________ is an amount that you pay in order to use or borrow money or the amount
earned on top of money that you invest.
______________________ is the amount of money you borrow or invest.
______________________ is the rate of interest paid over a given period of time, usually one year.













I can find the interest by using the following equation:





I can find the total amount (Principal & Interest) by using the following equation:





Guided Practice


Independent Practice
1) Principal: $290, Interest Rate: 12.5%, Period: 6 months







2) Rondells parents borrow $6,300 from the bank to buy a new car. The interest rate is 6% per year. How much simple
interest will they pay if they take 2 years to repay the loan?







3) Derricks dad bought new tires for $900 using a credit card. His card has an interest rate of 19%. If he has no other
charges on his card and does not pay off his balance at the end of the month, how much money will he owe after one
month?







Exit Ticket:
Banks lend money to people. They make their money by:
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You are borrowing $5,500 from the bank to help pay for you student loans. The interest rate is 5.5%. How much will you
end up paying, if it takes you five years to pay back the loan?


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Tuesday, October 28, 2014

Example 1: Marina deposits $1,500 in a savings account at Bank of America. The bank will pay her
5% interest at the end of the year. How much additional money from interest will Marina receive?














Answer: _____________________

Example 2: Jeffrey puts $800 into a savings account at Citi Bank. His account earns $32 interest in
two years. What is the annual interest dollar amount and annual interest rate (percent)?















Jeffrey will earn ___________ dollars annually from a___________ percent interest rate.


Example 3: Ms. Langston put $500 in a savings account for her granddaughter. The account earns
3% interest per year. Part A: What is the amount of money earned in interest after 3 years? Part
B: What is Ms. Langstons new balance after 3 years?



0% 100%



0
0% 100%



0






Part A: _____________________, Part B: _____________________
1. Tims parents lend Tim $100 so he can buy a radio-controlled airplane. They charge Tim 5%
simple annual interest. What will be the total amount that Tim will owe his parents in 1 year
(amount borrowed + interest!!)?













Answer: __________________
2. You deposit $600 into a bank account. After a year, the account earned $18 in interest, so the
new account balance os $618. Find the percent of interest that this account earns annually.












Answer: __________________
0% 100%



0
0% 100%



0
3. Lisa Simpson deposits $1,500 into a savings account that makes 3% interest per year. She leaves
this sum of money in the bank for two years before she checks her balance. Part A: How much
additional money will Lisa earn from this interest rate over the course of two years? Part A: How
much money will be in Lisas bank account when two years she checks her balance?










Part A: _____________________, Part B: _____________________


0% 100%



0
Wednesday, October 29, 2014

Watch Video https://www.youtube.com/watch?v=HaAJcWR5JtA
Simple interest vs. Compound interest (Easy-to-Understand Explanations)

Simple Interest Vs. Compound Interest

Simple Interest Formula: ________________________________________________

Arnold has $580 in his savings account that pays 3% simple interest. How much interest will he earn in
a) 5 years
b) 6 months
(Show your work in the space below labeled Part A and Part B)

If the money is in a savings account, is the interest money that Arnold is earning or money that he is
paying? (Circle the correct answer.)

Lets say that interest is paid on the money once a year and Arnold is not adding any money to the account.
What could we do to find the amount of interest earned for the two periods of time?
Part A



Part B

Terms
PV = Present Value (Principal amount) FV = Future Value (Principal amount + Interest Compounded)

Compound Interest Formula: __________________________________________

Using the same scenario, Arnold has $580 in his savings account that pays 3% compound interest. How
much interest will he earn in
a) 1 year b) 2 years c) 5 years

Part A

Part B
Part C

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