Financial Literacy: How to Calculate Interest
With this lesson, students will learn how to calculate simple interest. This is a foundational skill that is essential for understanding personal finance and making sound financial decisions in the real world. We’ll walk through some examples so that students can see how this concept applies in everyday life.
Included with this lesson are some adjustments or additions that you can make if you’d like, found in the “Options for Lesson” section of the Classroom Procedure page. One of the optional additions to this lesson is to invite someone who works at a bank to speak to your class about home, car, vacation, and college loans.
Description
Additional information, what our financial literacy: how to calculate interest lesson plan includes.
Lesson Objectives and Overview: Financial Literacy: How to Calculate Interest teaches students about simple interest. At the end of the lesson, students will be able to calculate simple interest rates, have a basic understanding of interest rates, and will be able to relate understanding interest rates to real-world applications. This lesson is for students in 5th grade and 6th grade.
Classroom Procedure
Every lesson plan provides you with a classroom procedure page that outlines a step-by-step guide to follow. You do not have to follow the guide exactly. The guide helps you organize the lesson and details when to hand out worksheets. It also lists information in the blue box that you might find useful. You will find the lesson objectives, state standards, and number of class sessions the lesson should take to complete in this area. In addition, it describes the supplies you will need as well as what and how you need to prepare beforehand. The supplies you will need for this lesson are calculators and Internet access.
Options for Lesson
Included with this lesson is an “Options for Lesson” section that lists a number of suggestions for activities to add to the lesson or substitutions for the ones already in the lesson. One optional addition to this lesson is to have your students find a second car with an unlimited budget and calculate what the interest would be for both good and bad credit. You can invite someone who works at a bank to speak to your class about different loans. They can also talk about why people borrow money and how to calculate interest. You can also speak to your class about saving money and earning interest with a savings account, CDs, or bonds. Finally, you can bring in some actual bank or credit card statements. Your students could see how interest applies to an account.
Teacher Notes
The teacher notes page includes a paragraph with additional guidelines and things to think about as you begin to plan your lesson. This page also includes lines that you can use to add your own notes as you’re preparing for this lesson.
FINANCIAL LITERACY: HOW TO CALCULATE INTEREST LESSON PLAN CONTENT PAGES
Interest rates.
The Financial Literacy: How to Calculate Interest lesson plan includes three pages of content. The lesson begins by explaining that people borrow money for cars, mortgages, vacations, college, starting businesses, and more. If you want to buy something but can’t pay full price immediately, you might be able to borrow money to purchase it. For example, if you want to buy a $700 phone but only have $200, you might ask your bank for a $500 loan. They might agree but might also charge you 10% interest on the loan.
Interest is the amount of money you either earn or pay. When you borrow money, you might have to pay interest. If you save money, you can earn interest.
The principal is the amount of money borrowed or saved. In this example, the $500 you borrow from the bank for the phone is the principal.
The rate is the percentage that a company or bank charges you for borrowing money or pays you for keeping your money in their bank.
If you want to calculate the simple interest on a loan, you can use the following formula: Interest = Principal x Rate x Time (years).
If you decide to pay the bank back within a year, you can use the formula to determine what you will owe: Interest = $500 x 0.10 x 1. Interest = $50. This means that after a year, you will have to pay the bank the full amount that you borrowed ($500) plus interest ($50). The full amount that you will owe is $550. If you borrow the money for two years, the formula would be: Interest = $500 x 0.10 x 2 = $100. After two years, you will have to pay the bank the amount borrowed plus interest ($500 + $100). The full amount that you will owe is $600.
It’s important to understand that interest can be a good thing for you, too. If you save $200 and put it into a savings account at 15% interest for a year, we can use the same formula to see how much money the bank will pay you in interest: Interest = $200 x 0.15 x 1. Interest = $30. After a year, you would have $230 total ($200 principal plus $30 in interest).
What if you kept it in that account for five years instead of one? Interest = $200 x 0.15 x 5. Interest = $150. After five years, you’ll have $350 ($200 + $150).
A good way to calculate interest is by using the rule of 72, which is when you take the number 72 and divide it by the interest rate. This gives you the approximate number of years that it would take to double your money. If you invest money at an 8% rate of return, it would take roughly nine years to double that money, according to the formula: 72 / 8 = 9.
FINANCIAL LITERACY: HOW TO CALCULATE INTEREST LESSON PLAN WORKSHEETS
The Financial Literacy: How to Calculate Interest lesson plan includes three worksheets: an activity worksheet, a practice worksheet, and a homework assignment. You can refer to the guide on the classroom procedure page to determine when to hand out each worksheet.
CAR PURCHASE ACTIVITY WORKSHEET
The activity worksheet asks students to find a car online that costs under $15,000. They will describe the car, write down the price, calculate the interest they would have to pay on the car, calculate the total cost of the loan, and more. They will do this for two interest rates. 4% if they have good credit, and 13% if they have bad credit.
CALCULATE INTEREST PRACTICE WORKSHEET
For the practice worksheet, students will calculate the interest on four items.
FINANCIAL LITERACY: HOW TO CALCULATE INTEREST HOMEWORK ASSIGNMENT
The homework assignment asks students to answer various questions about loans, interest rates, and more. They will also contact their local financial institution and ask them questions about loans, credit, and savings accounts.
Worksheet Answer Keys
This lesson plan includes answer keys for the activity worksheet, the practice worksheet, and the homework assignment. If you choose to administer the lesson pages to your students via PDF, you will need to save a new file that omits these pages. Otherwise, you can simply print out the applicable pages and keep these as reference for yourself when grading assignments.
grade-level | 5th Grade, 6th Grade |
---|---|
subject | Math, Social Studies |
State Educational Standards | LB.MATH.CONTENT.6.RP.A.3.C, LB.MATH. CONTENT.6.EE.B.6, & LB., & LB. MATH. CONTENT.6.EE.A.2 Lessons are aligned to meet the education objectives and goals of most states. For more information on your state objectives, contact your local Board of Education or Department of Education in your state. |
Related products
Black History Month
Careers: Astronaut
Careers: Zookeeper
Careers: Marine Biologist
Make your life easier with our lesson plans, stay up-to-date with new lessons.
- Lesson Plans
- For Teachers
© 2024 Learn Bright. All rights reserved. Terms and Conditions. Privacy Policy.
- Sign Up for Free
- Notifications 0
- Add Friend ($5)
As a registered member you can:
- View all solutions for free
- Request more in-depth explanations for free
- Ask our tutors any math-related question for free
- Email your homework to your parent or tutor for free
- Grade 7 McGraw Hill Glencoe - Answer Keys
The Masters family financed a computer that cost $1,200. If the interest rate is 19%, how much will the family owe for the computer after one month if no payments are made? | \(\large$ \) |
Explanation:
Samantha received a loan from the bank for $4,500. She plans on paying off the loan in 4 years. At the end of 4 years, Samantha will have paid $900 in interest. What is the simple interest rate on the bank loan?
\(\large \text{rate =} \) | \(\large \text{ %}\) |
Building on the Essential Question How can you use a formula to find simple interest?
Yes, email page to my online tutor. ( if you didn't add a tutor yet, you can add one here )
Thank you for doing your homework!
IMAGES
VIDEO
COMMENTS
Find the simple interest paid to the nearest cent for each loan, interest rate, and time. $500, 12%, 18 months. $90.00. Find the simple interest paid to the nearest cent for each loan, interest rate, and time. $300, 9%, 3 years. $81.00. Find the simple interest paid to the nearest cent for each loan, interest rate, and time. $2,000, 20%, 1 year.
Lesson 8 Homework Practice Financial Literacy DATE PERIOD Find the simple interest earned to the nearest cent for each principal, ... 2. $1,200, 3.5%, 2 years 5. $530, 6%, 1 year 3. $450, 5%, 4 months 6. $600, 8%, 1 month Find the simple interest paid to the nearest cent for each loan, interest rate, and time. 7. $668, 5%, 2 years
Study with Quizlet and memorize flashcards containing terms like Find the simple interest earned to the nearest cent for the principal, interest rate, and time. $640, 3%, 2 years, Find the simple interest earned to the nearest cent for the principal, interest rate, and time. $1,500, 4.25%, 4 years, Find the simple interest earned to the nearest cent for the principal, interest rate, and time ...
Lesson 8 Homework Practice Financial Literacy Find the simple interest earned to the nearest cent for each principal, interest rate, and time. 1.$750, 7%, 3 years 2. $1,200, 3.5%, 2 years 3. $450, 5%, 4 months 4.$1,000, 2%, 9 months 5. $530, 6%, 1 year 6. $600, 8%, 1 month Find the simple interest paid to the nearest cent for each loan ...
Improve your grades and reach your goals with flashcards, practice tests and expert-written solutions today. Flashcards. 1 / 14 Chapter 2 Lesson 8 Financial Literacy - Simple Interest. Log in. Sign up. Get a hint. Find the simple interest earned to the nearest cent for each principal, interest rate, and time. $750, 7%, 3 years ...
Lesson 8 Homework Practice Financial Literacy DATE PERIOD Find the simple interest earned to the nearest cent for each principal, interest rate, and time. ... $4.00 DuE 'p 7.50 015 4. $1,000, 2%, 9 months...' 5. $530, 6%, 1 year $15.00 '10/5 $31.80 DuE go Find the simple interest paid to the nearest cent for each loan, interest rate, and time ...
Lesson 8 Problem Solving Practice Financial Literacy 1.SAVINGS ACCOUNT How much interest will Hannah earn in 4 years if she ... in a retirement account that earns 3.85% simple interest each year. Find the amount earned each year by this investment. 4.COLLEGE FUND When Melissa was born, her parents put $8,000 into a college fund account that earned
Grade 7: Chapter 2, Lesson 8: pgs. 167 - 174 Financial Literacy: Simple Interest Part 1: Finding Simple Interest Complete the following problems. *Helpful Hint: Change the percents to decimals first!* ... What is the simple interest rate on the bank loan? Author: MaryTary Created Date: 9/1/2015 1:53:41 PM ...
Email your homework to your parent or tutor for free; ... Lesson 8: Financial Literacy: Simple Interest. ... Independent Practice. Find the simple interest earned to the nearest cent for each principal, interest rate, and time. Question 1 (request help) $640, 3%, 2 years ...
If you want to calculate the simple interest on a loan, you can use the following formula: Interest = Principal x Rate x Time (years). If you decide to pay the bank back within a year, you can use the formula to determine what you will owe: Interest = $500 x 0.10 x 1. Interest = $50.
Lesson 8 Homework Practice Financial Literacy Find the simple interest earned to the nearest cent for each principal, interest rate, and time. ... 3. $450, 5%, 4 months 4. $1,000, 2%, 9 months 5. $530, 6%, 1 year 6. $600, 8%, 1 month Find the simple interest paid to the nearest cent for each loan, interest rate, and time. 7. $668, 5%, ...
Lesson 8: Simple Interest <<<<Daily Lesson Rewind>>>> Re-Teach Guide. reteach_financial_literacy_simple_interest.pdf: File Size: 174 kb: File Type: pdf: Download File. HW Assignment . problem_solving_practice_financial_literacy_simple_interest.pdf: File Size: 181 kb: File Type: pdf:
Email your homework to your parent or tutor for free; ... Chapter 2: Percents; Lesson 8: Financial Literacy: Simple Interest. ... (request help) Financial Literacy The table shows interest owed for a home improvement loan based on how long it takes to pay off the loan. a. What is the simple interest owed on $900 for 9 months? \(\large I ...
Math 7 -Lesson 8 Financial Literacy. financial literacy. Click the card to flip 👆. the ability to understand how money works in the world including how someone manages to earn or make it, how that person manages it, how he/she invests it (turn it into more) and how that person donates it to help others. Click the card to flip 👆. 1 / 12.
7. $903, 8.75%, 18 months 8. $4,275, 19%, 3 months Lesson 8 Reteach Financial Literacy Simple interest is the amount of money paid or earned for the use of money. To fi nd simple interest I, use the formula I = prt. Principal p is the amount of money deposited or invested. Rate r is the annual interest rate written as a decimal.
Email your homework to your parent or tutor for free; ... Chapter 2: Percents; Lesson 8: Financial Literacy: Simple Interest. ... Extra Practice. Find the simple interest earned to the nearest cent for each principal, interest rate, and time. Question 14 (request help) Question 15 ...
Unit: Personal Financial Literacy Homework 2 Name Date MINIMUM HOUSEHOLD BUDGETS ... Before the lesson, consider asking students what they already know about sales tax. They are likely ... o $8.00 1.13E 1 CAN CALCULATE SIMPLE INTEREST AND COMPOUND INTEREST EARNINGS. 4. An investment of $600 is made into an
Below are the downloadable Grade 8 financial literacy learning sessions created by Ontario Certified Teachers at United for Literacy. The learning sessions are accompanied by downloadable presentations, performance tasks, and worksheets. Please be mindful of the students' and their families' lived experiences, and modify the content ...
Lesson 8 Homework Practice Financial Literacy Find the simple interest earned to the nearest cent for each principal, interest rate, and time. 1. $750, 7%, 3 years 2. $1,200, 3.5%, 2 years 3. $450, 5%, 4 months 4. $1,000, 2%, 9 months 5. $530, 6%, 1 year 6. $600, 8%, 1 month Find the simple interest paid to the nearest cent for each loan ...
Grade 8 - F1.4 Financial Literacy: Example of Learning Objectives and Big Ideas Specific Expectation Learning Objectives F1.4 determine the growth of simple and compound interest at various rates using digital tools, and explain the impact interest has on long-term financial planning To calculate simple interest to solve problems. Assessment 1.
Email your homework to your parent or tutor for free; ... Chapter 2: Percents; Lesson 8: Financial Literacy: Simple Interest. ... Guided Practice: Question 1 (request help) The Masters family financed a computer that cost $1,200. If the interest rate is 19%, how much will the family owe for the computer after one month if no payments are made? ...