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Bellringer Calculate the Simple Interest for #s 1 and 3 and the Total cost for #2. 1.$1800 at 3.2% for 4 years. 2. $17250 at 7.5% for 6 years. 3. $3,650.

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Presentation on theme: "Bellringer Calculate the Simple Interest for #s 1 and 3 and the Total cost for #2. 1.$1800 at 3.2% for 4 years. 2. $17250 at 7.5% for 6 years. 3. $3,650."— Presentation transcript:

1 Bellringer Calculate the Simple Interest for #s 1 and 3 and the Total cost for #2. 1.$1800 at 3.2% for 4 years. 2. $17250 at 7.5% for 6 years. 3. $3,650 at 7⅞% for 5 years. TALKING = 0%

2 Simple Interest Simple Interest- earnings are paid on a fixed amount of money, or Principal. To calculate Simple Interest, use the formula I = prt, where I is the interest earned, p is the principal (amount invested), r is the interest rate (must be written as a decimal), and t is the time invested in years.

3 Simple Interest Yolanda deposited $3,000 into an account that earns 4½% simple interest annually. Calculate the interest she will earn after six years. How much money will she have in her account?

4 Simple Interest Adrian invested $4700 into a saving account that earns 3.25% simple interest for 7 years. How much interest will be earned after the 7 years and how money will be in the account?

5 Compound Interest Compounded Interest earnings are calculated on the original amount plus accumulated interest. The principal increases each year based on the interest earned.

6 Compound Interest To calculate compound interest, use the formula, (on Page 702), where A is the total account balance, P is the principal, r is the interest rate (expressed as a decimal), n is the number of times interest is compounded per year, and t is the time in years. The finally step is to subtracted the compound interest from the principal.

7 Compound Interest Compound interest can be compounded annually (once a year), semi-annually (2 times a year), quarterly (3 times a year), monthly (12 times a year), and daily (365 times a year).

8 Compound Interest By increasing the amount of times the interest is compounded, the interest that is earned also increases.

9 Writing Prompt Explain the steps you use in a mathematical process we have been studying in this class OR Write about how you or your parents use math in their jobs or everyday life. OR Describe a job/profession that requires math skills and explain how math is used.


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