1. 6-7 Simple Interest Warm Up Warm Up Lesson Presentation Lesson Presentation Problem of the Day Problem of the Day Lesson Quizzes Lesson Quizzes

2. 6-7 Simple Interest Warm Up Multiply. 1. 800  0.04  3 2. 1,700  2  0.25 3. 900  0.05  4 4. 1,200  6  0.35 96 850 180 2,520

3. 6-7 Simple Interest Problem of the Day Which number does not belong in the group? 0.75 75% 3434 6868 75 1,000 75 1,000 = ; 3 40 the others equal. 3434

4. 6-7 Simple Interest MA.7.A.1.2 Solve percent problems, including problems involving…simple interest… Sunshine State Standards

5. 6-7 Simple Interest Vocabulary interest simple interest principal

6. 6-7 Simple Interest When you keep money in a savings account, your money earns interest. Interest is an amount that is charged for borrowing or using money, or an amount of money that is earned by saving money. For example, the bank pays you interest to use your money to conduct its business. Likewise, when you borrow money from the bank, the bank collects interest on its loan to you.

7. 6-7 Simple Interest One type of interest, called simple interest, is money paid only on the principal. The principal is the amount of money deposited or borrowed. To solve problems involving simple interest, you can use the following formula. I = P · r · t Interest Principal Rate of interest per year (as a decimal) ‏ Time in years that the money earns interest

8. 6-7 Simple Interest Find the missing value. Additional Example 1A: Using the Simple Interest Formula I =, P = $575, r = 8%, t = 3 years I = P · r · t I = 575 · 0.08 · 3 I = $138 The simple interest is $138.00. Substitute. Use 0.08 for 8%. Multiply.

9. 6-7 Simple Interest Find the missing value. Additional Example 1B: Using the Simple Interest Formula I = $204, P = $1,700, r =, t = 6 years I = P · r · t 204 = 1,700 · r · 6 204 = 10,200r 204 10,200 = 10,200r 10,200 0.02 = r The interest rate is 2% Substitute. Multiply. Divide by 10,200 to isolate the variable. ?

10. 6-7 Simple Interest Find the missing value. Check It Out: Example 1A I = ; P = $5,000, r = 4%, t = 6 years l = 5,000 0.04 6 = 1,200 ?

11. 6-7 Simple Interest Find the missing value. Check It Out: Example 1B I = $600, P = $2,000, r =, t = 3 years 600 = 2,000 r 3 600 = 6,000 r 600 6000 = 6,000r 6,000 0.1 = r 10% = r ?

12. 6-7 Simple Interest Additional Example 2: Problem Solving Application Avery deposits $6,000 in an account that earns 4% simple interest. How long will it take for his account balance to reach $6,800? 1 Understand the Problem Rewrite the question as a statement: Find the number of years it will take for Avery’s account to reach $6,800. List the important information: The principal is $6,000. The interest rate is 4%. His account balance will be $6,800.

13. 6-7 Simple Interest 2 Make a Plan Avery’s account balance A includes the principal plus the interest: A = P + I. Once you solve for I, you can use I = P · r · t to find the time. Additional Example 2 Continued

14. 6-7 Simple Interest Solve 3 A = P + I 6,800 = 6,000 + I 800 = I I = P · r · t 800 = 6,000 · 0.04 · t 800 = 240t 3.33  t It will take 3 1313 years. Substitute. Subtract to isolate the variable. Substitute. Use 0.04 for 4%. Multiply. Divide to isolate the variable. Round to the nearest hundredth. –6,000 – 6,000 800 240 = 240t 240 Additional Example 2 Continued

15. 6-7 Simple Interest Look Back 4 After exactly 3 years, Avery’s money will have earned $800 in simple interest and his account balance will be $6,800. 1313 I = 6,000 · 0.04 · 3 1313 = 800 So it will take 3 years to reach $6,800. 1313 Additional Example 2 Continued

16. 6-7 Simple Interest Check It Out: Example 2 Linda deposits $10,000 in an account that earns 8% simple interest. How long will it take for the total amount in her account to reach $12,000? A = P + l 12,000 = 10,000 + l 2,000 = l l = P r t 2,000 = 10,000 · 0.08 · t 2,000 = 800 · t

17. 6-7 Simple Interest 2,000 800 Check It Out: Example 2 Continued = 800. t 800 2.5 = t It will take 2 years. 1212

18. 6-7 Simple Interest Standard Lesson Quiz Lesson Quizzes Lesson Quiz for Student Response Systems

19. 6-7 Simple Interest Lesson Quiz Find each missing value. 1. I = 2. I = $18, P = $150, r = 3. I = $640, P = 4. I = $120, P = $600, r = 5% t = 6% $240 $2,000 4 years, P = $800, r = 10%, t = 3 years, t = 2 years, r = 4%, t = 8 years 5. Dennis deposits $6,000 in an account that earns 5.5% simple interest. How long will it take before the total amount is $8,000? A little over 6 years

20. 6-7 Simple Interest 1.Identify the missing value. I =, P = $1000, r = 6%, t = 3 years A. $180 B. $200 C. $220 D. $250 Lesson Quiz for Student Response Systems

21. 6-7 Simple Interest 2.Identify the missing value. I = $12, P = $120, r =, t = 1 year A. 15% B. 10% C. 5% D. 3% Lesson Quiz for Student Response Systems

22. 6-7 Simple Interest 3.Identify the missing value. I = $520, P =, r = 5%, t = 8 years A. $1600 B. $1500 C. $1300 D. $1000 Lesson Quiz for Student Response Systems

23. 6-7 Simple Interest 4.Identify the missing value. I = $140, P = $500, r = 7%, t = A. 4 years B. 5 years C. 6 years D. 7 years Lesson Quiz for Student Response Systems

24. 6-7 Simple Interest 5. Tony deposits $5,000 in an account that earns 6.5% simple interest. How long will it take before the total amount is $7,000? A. a little over 9 years B. a little over 8 years C. a little over 7 years D. a little over 6 years Lesson Quiz for Student Response Systems