1. Stand Quietly

2. Lesson 6.7_Simple Interest
Students will be able to use proportional relationships to solve multistep ratio and percent problems CCSS. 7.RP.3

3. Warm-Up #17 (4/4/17)
You bought dinner for $20. You gave a 15% tip. How much tip did you leave?
Rick bought 2 shirts for $15 each. The sales tax rate is 8.5%. How much did he pay?
It costs $10 to make a skateboard. The retailer wants to mark up 80%. What is the sale price?

4. Homework
(4/3/17)  Worksheet: Tax and Tips (Percent) Word Problems (4/4/17)  Textbook: page 256. #5-23 ODD

5. is money added onto the original amount saved (earned) or borrowed (charged).
Simple Interest

6. I = PRT I = interest earned (amount of money the bank pays you)
P = Principle amount invested or borrowed.
R = Interest Rate usually given as a percent (must changed to decimal before plugging it into formula)
T = Time (must be measured in years) or converted to years by dividing by 12 months

7. I = PRT Solve for one of variables:
To solve for missing variable you must:
Plug in what you know
Use order of operations

8. Converting Change % to decimal 1) 12% 2) 5% 3) 2 ½ % 4) 8.5%
Change from decimal to %
5) .098
6) .455
Answers
1) .12
2) .05
3) .025
4) .085
5) 9.8%
6) 45.5%
Move 2 places
to left & drop % sign
Move 2 places
to right & add % sign

9. Calculating Simple Interest
How much money would you pay in interest if you borrowed $1,600 for 1 ½ years at 16% APR?
Convert the percent to a decimal.
16% = 0.16
I = prt
I = ($1,600)(0.16)(1.5)
I = $384
Total balance: =$ 1984

10. Molly bought a beautiful house for $350,000
Molly bought a beautiful house for $350,000. Her loan was for 30 years at 6.5% APR (annual percentage rate). How much money will she end up paying in interest?
6.5% = 0.065
I = prt
I = ($350,000)(0.065)(30)
I = $682,500
Total Balance: 350, ,500= $1,032,500

11. Kent put $8,500 into an 18 month CD. The interest rate is 3
Kent put $8,500 into an 18 month CD. The interest rate is 3.25% How much money will Kent earn in interest?
3.25% =
I = prt
I = ($8,500)(0.0325)(1.5)
I = $414.38
Total balance: 8, =$8,914.38

12. Katie bought a new sports car for $28,500
Katie bought a new sports car for $28,500. She financed her car for 6 years at 6.75%APR. How much will she end up paying for interest on her car?
6.75% =
I = prt
I = $28,500 x x 6
I = $11,542.50

13. Cody bought a new truck for $25,000
Cody bought a new truck for $25,000. He took out a loan for 5 ½ years with 7.75% APR. How much will Cody end up paying in interest?
7.75% =
I = prt
I = ($25,000)(0.0775)(5.5)
I = $10,656.25

14. Tia saved her $9,000 for 2 ½ years at 4
Tia saved her $9,000 for 2 ½ years at 4.25% APR in a CD, to go on a month long vacation with her family. How much did she earn in interest?
4.25% =
I = prt
I = $9,000 x x 2.5
I = $956.25

15. Interest paid by bank is unknown Principle (invested)
1. A savings account is set up so that the simple interest earned on the investment is moved into a separate account at the end of each year. If an investment of $5,000 is invested at 4.5%, what is the total simple interest accumulated in the checking account after 2 years.
Interest paid by bank is unknown
Principle (invested)
Rate changed to decimal
Time is 2 years
Multiply
I = PRT I=
I=$450
(5,000)
(.045)
(2)

16. Interest paid by bank is unknown Principle (invested)
2. A savings account is set up so that the simple interest earned on the investment is moved into a separate account at the end of each year. If an investment of $7,000 is invested at 7.5%, what is the total simple interest accumulated in the checking account after 3 years.
I = PRT I=
I=$1575
Interest paid by bank is unknown
Principle (invested)
Rate changed to decimal
Time is 3 years
Multiply
(7,000)
(.075)
(3)

17. Principle (invested) is unknown Rate changed to decimal Time is 1 year
3. When invested at an annual interest rate of 6% an account earned $ of simple interest in one year. How much money was originally invested in account?
I = PRT
180=
180 = .06P
3,000 = P
Interest paid by bank
Principle (invested) is unknown
Rate changed to decimal
Time is 1 year
Multiply
Divide P
(.06)
(1)

18. Principle (invested) is unknown Rate changed to decimal Time is 1 year
4. When invested at an annual interest rate of 7% an account earned $ of simple interest in one year. How much money was originally invested in account?
I = PRT
581=
581 = .07P
$8,300 =P
Interest paid by bank
Principle (invested) is unknown
Rate changed to decimal
Time is 1 year
Multiply
Divide P
(.07)
(1)

19. 5. A savings account is set up so that the simple interest earned on the investment is moved into a separate account at the end of each year. If an investment of $7,000 accumulate $910 of interest in the account after 2 years, what was the annual simple interest rate on the savings account?
I = PRT
910=
910 = (7,000)(2)R
910 = 14,000 R
14, ,000
0.065 = R
6.5% = R
Interest paid by bank
Principle (invested)
Rate is unknown
Time is 2 years
Regroup & Multiply
Divide
Change to %
(7,000)
(R)
(2)

20. 6. A savings account is set up so that the simple interest earned on the investment is moved into a separate account at the end of each year. If an investment of $2,000 accumulate $360 of interest in the account after 4 years, what was the annual simple interest rate on the savings account?
I = PRT
360=
360 = (2,000)(4)R
360 = 8,000 R
8,000 8,000
0.045 = R
4.5% = R
Interest paid by bank
Principle (invested)
Rate is unknown
Time is 4 years
Regroup & Multiply
Divide
Change to %
(2,000)
(R)
(4)

21. Interest paid by bank Principle (invested) Rate is unknown
7. Sylvia bought a 6-month $1900 certificate of deposit. At the end of 6 months, she received a $209 simple interest. What rate of interest did the certificate pay?
Interest paid by bank
Principle (invested)
Rate is unknown
Time is 6 months
(divide by 12)
Regroup & Multiply
Divide
Change to %
I=PRT
209=
209=(1900)(6/12)R
209=950R
950
0.22 = R
22% = R
1900
(R)
(6/12)

22. Interest paid by bank - Unknown Principle (invested) Rate is .045
8. An investment earns 4.5% simple interest in one year. If the money is withdrawn before the year is up, the interest is prorated so that a proportional amount of the interest is paid out. If $2400 is invested, what is the total amount that can be withdrawn when the account is closed out after 2 months?
Interest paid by bank - Unknown
Principle (invested)
Rate is .045
Time is 2 months
(divide by 12)
Multiply
Now, since the money is being withdrawn, add the interest to the principal.
I=PRT I=
(2400)
(.045)
(2/12)
I=$18
$18 + $2400 = $2418
$2418 will be withdrawn