Financial Algebra © 2011 Cengage Learning. All Rights Reserved. Slide 1 3-4 EXPLORE COMPOUND INTEREST Understand the concept of getting interest on your.

Slides:

Advertisements

Similar presentations

3-7 FUTURE VALUE OF INVESTMENTS

Advertisements

OBJECTIVES 4-2 LOANS Read monthly payments from a table.

3.5 Compound Interest Formula

Simple Interest and Compound Interest

What is Interest? Interest is the amount earned on an investment or an account. Annually: A = P(1 + r) t P = principal amount (the initial amount you borrow.

Financial Algebra © 2011 Cengage Learning. All Rights Reserved. Slide SAVINGS ACCOUNTS Learn the basic vocabulary of savings accounts. Compute simple.

6-2 PAY PERIODS AND HOURLY RATES

Financial Algebra © Cengage/South-Western Slide CREDIT CARDS Become familiar with the basic vocabulary of credit cards. Compute an average daily.

Financial Algebra © 2011 Cengage Learning. All Rights Reserved. Slide CHECKING ACCOUNTS Understand how checking accounts work. Complete a check register.

6-5 SOCIAL SECURITY AND MEDICARE

Financial Algebra © Cengage Learning/South-Western Slide 1 10/1/201410/1/2014 WARM-UP What large purchases do you see in your future? How does one determine.

Daily Compounding pp SECTION. Click to edit Master text styles Second level Third level Fourth level Fifth level 2 SECTION Copyright © Glencoe/McGraw-Hill.

3 BANKING SERVICES 3-1 Checking Accounts

3-8 PRESENT VALUE OF INVESTMENTS

Financial Algebra © Cengage Learning/South-Western 9/30/20149/30/2014 Warm-Up Sam deposits $4,000 into a CD that is continuously compounded. The CD pays.

Financial Algebra © 2011 Cengage Learning. All Rights Reserved. Slide COMPOUND INTEREST FORMULA Become familiar with the derivation of the compound.

Chapter 12 Compound Interest and Present Value McGraw-Hill/Irwin Copyright © 2011 by the McGraw-Hill Companies, Inc. All rights reserved.

4-3 LOAN CALCULATIONS AND REGRESSION

Compound Interest and Present Value

Financial Algebra © 2011 Cengage Learning. All Rights Reserved. Slide CONTINUOUS COMPOUNDING Compute interest on an account that is continuously.

SECTION 5-4 Simple Interest pp

SECTION 5-4 Simple Interest pp

Notes Over 7 – 8 1. Suppose you deposit $1000 in a savings account that earns 6% per year. Find the interest earned in two years. Simple Interest Formula.

Financial Algebra © Cengage Learning/South-Western Warm-UpWarm-Up Grab a paper from the back Susan wants to invest her $1,500 into a savings account that.

OBJECTIVES 3-3 SAVINGS ACCOUNTS

SECTION 5-4 Simple Interest pp

Compound Interest SWBAT compute compound interest using a table.

SECTION 5-6 Compound Interest Tables pp

3-5 COMPOUND INTEREST FORMULA

MBF3C Lesson #6: Saving Alternatives

4-3 LOAN CALCULATIONS AND REGRESSION

McGraw-Hill/Irwin ©2011 The McGraw-Hill Companies, All Rights Reserved Chapter 12 Compound Interest and Present Value.

Economics.  Interest can mean two things to the consumer…  If you put money in a bank, you will get paid interest on your deposit over time.  If you.

Business Math 3.6 Savings Account.

Notes Over 7 – 7 Solve for the indicated variable.

Financial Algebra © Cengage/South-Western Slide FUTURE VALUE OF INVESTMENTS Calculate the future value of a periodic deposit investment. Graph the.

Explore Compound Interest

Compound Interest Tables pp SECTION.

Financial Algebra © 2011 Cengage Learning. All Rights Reserved. Slide RECONCILE A BANK STATEMENT Reconcile a checking account with a bank statement.

Compound Interest Formula

3.6 Savings Accounts Calculate simple interest on savings deposits

Financial Algebra © Cengage/South-Western Slide 1 BANKING SERVICES 3-1Checking Accounts 3-2Reconcile a Bank Statement 3-3Savings Accounts 3.

Planning Ahead Saving money is an important part of financial freedom and responsibility. What are the advantages of having a savings account?

3 BANKING SERVICES 3-4 Explore Compound Interest

Financial Algebra © Cengage Learning/South-Western Warm-UpWarm-Up Grab a paper from the back AND pull out Friday’s notes Manny invests $40,000 in a one.

Section 6.7 Financial Models. OBJECTIVE 1 A credit union pays interest of 4% per annum compounded quarterly on a certain savings plan. If $2000 is.

Compound Interest Formula. Compound interest arises when interest is added to the principal, so that, from that moment on, the interest that has been.

Financial Algebra © 2011 Cengage Learning. All Rights Reserved. Slide COMPOUND INTEREST FORMULA Become familiar with the derivation of the compound.

Section 4.7: Compound Interest. Continuous Compounding Formula P = Principal invested (original amount) A = Amount after t years t = # of years r = Interest.

Financial Algebra © 2011 Cengage Learning. All Rights Reserved. Slide CHECKING ACCOUNTS Understand how checking accounts work. Complete a check register.

Financial Algebra © 2011 Cengage Learning. All Rights Reserved. Slide SAVINGS ACCOUNTS Learn the basic vocabulary of savings accounts. Compute simple.

Financial Algebra © 2011 Cengage Learning. All Rights Reserved. Slide PRESENT VALUE OF INVESTMENTS Calculate the present value of a single deposit.

Section 5.7 Financial Models. A credit union pays interest of 4% per annum compounded quarterly on a certain savings plan. If $2000 is deposited.

Compound Interest. interest that actually earns interest itself to figure: –find the initial interest –add it to the principal –find the interest on the.

Financial Algebra © 2011 Cengage Learning. All Rights Reserved. Slide FUTURE VALUE OF INVESTMENTS Calculate the future value of a periodic deposit.

Simple and Compound Interest Simple Interest I = Prt Compound Interest A = P(1 + r)

Financial Algebra © Cengage/South-Western Slide 1 BANKING SERVICES 3-1Checking Accounts 3-2Reconcile a Bank Statement 3-3Savings Accounts 3-4Explore Compound.

5.1 Deposits Savings Accounts: earn interest on the money in the account for bank’s use of your money. Deposit: Money given to the bank to hold. ◦ Deposit.

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.

© Thomson/South-Western ECONOMIC EDUCATION FOR CONSUMERS Slide 1 Chapter 8 LESSON 8.4 Simple and Compound Interest Objectives: By the end of class, students.

7.5 Compound Interest and Present Value Mr. Peltier.

Interest Applications - To solve problems involving interest.

Compound Interest and Present Value

Savings and Interest Lesson 4.4.

2-4 Explore Compound Interest

Savings and Interest Skill 11.

PLEASE NOTE!! If you have not completed your Checking Account Project yet, you have 30 minutes to work on it. It is a project grade To get reminders about.

3-5 COMPOUND INTEREST Your money can grow larger and quicker with compound interest than it can with simple interest.

Presentation transcript:

Financial Algebra © 2011 Cengage Learning. All Rights Reserved. Slide EXPLORE COMPOUND INTEREST Understand the concept of getting interest on your interest. Compute compound interest using a table. OBJECTIVES

Financial Algebra © 2011 Cengage Learning. All Rights Reserved. Slide 2 compound interest annual compounding semiannual compounding quarterly compounding daily compounding crediting Key Terms

Financial Algebra © 2011 Cengage Learning. All Rights Reserved. Slide 3 Example 1 How much interest would $1,000 earn in one year at a rate of 6%, compounded annually? What would be the new balance?

Financial Algebra © 2011 Cengage Learning. All Rights Reserved. Slide 4 Example 2 Alex deposits $4,000 in a savings account that pays 5% interest, compounded semiannually. What is his balance after one year?

Financial Algebra © 2011 Cengage Learning. All Rights Reserved. Slide 5 EXAMPLE 3 How much interest does $3,000 earn in six months at an interest rate of 4%, compounded quarterly? What is the balance after six months?

Financial Algebra © 2011 Cengage Learning. All Rights Reserved. Slide 6 EXAMPLE 4 How much interest does $1,000 earn in one day at an interest rate of 6%, compounded daily? What is the balance after a day?

Financial Algebra © 2011 Cengage Learning. All Rights Reserved. Slide 7 How much interest does x dollars earn in one day at an interest rate of 5%, compounded daily? Express the answer algebraically. CHECK YOUR UNDERSTANDING

Financial Algebra © 2011 Cengage Learning. All Rights Reserved. Slide 8 Jennifer has a bank account that compounds interest daily at a rate of 3.2%. On July 11, the principal is $1, She withdraws $200 for a car repair. She receives a $34 check from her health insurance company and deposits it. On July 12, she deposits her $ paycheck. What is her balance at the end of the day on July 12? Example 5