A W M a th 11 Name:  

Vanier Mathematics

 1

CHAPTER 6A: Financial Services, Book 1  

☐ Day 1 Percent Review

☐ Day 2 Algebra Review and Intro to Payday Loans

☐ Day 3 Simple Interest

☐ Day 4 Rule of 72

BOOKLET CRITERIA: Assignments ( 24 marks) ¨ completed ¨ all work is shown ¨ pencil & ruler/protractor used

Students found copying AND students found lending their booklets will BOTH receive zero.

A W M a th 11 Name:  

Vanier Mathematics

 2

DAY 1 Percent Review class notes

Fraction Decimal Percent

71200

98

3.26

0.0032

160%

0.35%

25!!%

Fraction  

Percent  Decimal  

A W M a th 11 Name:  

Vanier Mathematics

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DAY 1 Percent Review class notes continued EXAMPLE 1 Sam scored 32 out of 40 on his math test. What was his percent? EXAMPLE 2 On payday, Jana put $69.87 into a savings account. She was left with $395.91. What percent of her paycheque did she put into savings? EXAMPLE 3 Westjet allows employees to put a maximum of 18!

!% of their pay into

shares. Myriam makes $31 524 as a flight attendant and maximizes her share contributions. How much money did Myriam put into shares for the year?

A W M a th 11 Name:  

Vanier Mathematics

 4

DAY 1 Percent Review assignment

1. Complete the table below.

Fraction Decimal Percent

42205

2.59

  31%

8619  

  0.253

75%

3120

10.1

5 !!"

%

8172

0.4679

25!!%

A W M a th 11 Name:  

Vanier Mathematics

 5

DAY 1 Understanding Percent assignment continued

1. If you purchase an iPod that costs $339, how much sales tax will you pay if the rate is 8.375%?

2. A shirt that regularly sells for $38.50 is on sale for 25% off, by how much money is the shirt being discounted?

3. If 13 out of 27 students in a computer class are seniors, then what percent of the class is composed of seniors?

4. A meteorologist was accurate 90% of the time, reporting accurately on 45 days.

How many days of weather did he report?

5. At Kennedy High School, 119 students walk to school. If this number is 35% of school enrollment, then how many students are enrolled at the school?

6. Last year a school had 139 honor students and a school population of 739. What is the percent of honor students?

7. At the Hip-Hop Shop each salesperson receives an 8.5% commission on sales. What would a salesperson earn if she sold $250 in goods?

8. At a supermarket the hourly pay increased from $14.00 to $15.50. What is the percent increase in pay?

A W M a th 11 Name:  

Vanier Mathematics

 6

DAY 2 Algebra Review class notes HOW TO Solve One-Step Equations Algebraically Example 1: !! =  −!" 1. Write Equation

2. Perform the Opposite Operation

3. Cancel Out

4. Write the Answer

5. Check your Answer

Example 2: !

!=  −!

1. Write Equation

2. Perform the Opposite Operation

3. Cancel Out

4. Write the Answer

5. Check your Answer

A W M a th 11 Name:  

Vanier Mathematics

 7

DAY 2 Algebra Review class notes continued HOW TO Solve Two-Step Equations Algebraically Example 1: !" + ! =  !" 1. Write Equation

2. Perform Opposite & Cancel • 1st addition and subtraction • 2nd multiplication and division

3. Write the Answer & Check

Example 2: !

!− ! =  !"

1. Write Equation

2. Perform Opposite & Cancel • 1st addition and subtraction • 2nd multiplication and division

3. Write the Answer & Check

A W M a th 11 Name:  

Vanier Mathematics

 8

DAY 2 Algebra Review assignment Part 1: Algebra Review

1. Solve for each variable. (Check the steps on page 7 and 8 for help!)

a) 6z  =  −54  

 

b) 5c  =  −50  

   

 c) −4a  =  −20  

 

d) 3a  +  5  =  2  

     

e) -­‐2b  +  9  =  25  

   

f) −3v  +  10  =  40  

 

g) −3u  +  3  =  −21  

 

h) −2b  +  6  =  −10  

A W M a th 11 Name:  

Vanier Mathematics

 9

Part 2. Payday Loans Complete the reading below on ‘payday loans’. You will need a calculator for the end of this section.

Information from: Manitoba.ca > Department of Senior and Consumer Affairs Healthy Living

1. What is a payday loan?

A payday loan is a loan of money of not more than $1500.00 for a term of no longer than 62 days (not including any extension or renewal).

2. What is a payday lender?

A payday lender is a licensed business or person who offers, arranges or provides a payday loan.

For example, this can include a business that only offers, arranges or provides a payday loan, or it can be a business that in addition to offering payday loans also offers other goods or services such as pawn broking, income tax rebating, or retail products.

3. Does a payday lender need to be licensed to provide payday loans in Manitoba?

Yes.

4. If a payday lender offers payday loans over the internet, do they need to be licensed?

Yes. Internet lenders must be licensed and they must follow the same rules as payday lenders with store front locations.

5. What is the most I can be charged if I take out a payday loan?

The most you can be charged for a payday loan is 17% of the principal amount of the loan ($17 per $100 borrowed).

If you are charged more than the maximum rate allowed, you have the right to be reimbursed the entire amount of the fee charged.

A W M a th 11 Name:  

Vanier Mathematics

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6. What is the maximum amount I can borrow from a payday lender?

The maximum amount you can borrow from a payday lender depends on your monthly net income for the most recent previous calendar month. Your net pay must be determined using the formula found below. Once your net pay has been calculated, you will be able to borrow up to a maximum of 30% of your calculated net pay.

Net pay= MNI x 12 26 In this formula, MNI is your net income for the most recent previous calendar month in which you received income. It is calculated by adding all of the sources of income you received during that month, minus all deductions.

Example: If your previous net pay is determined by the above formula to be $1000, the most you can borrow is $300. If you take out a 12 day payday loan, at the maximum rate of 17%, the chart below shows you the maximum you can be charged:

Net Pay as determined by net pay formula ($)

Maximum amount you may borrow

($)

Maximum rate

you can be

charged

How much it will cost you ($)

How much

you will have to

repay ($)

APR (%) Annual

Percentage Rate

1000.00 300.00 17% 51.00 351.00 517%

7. If I want to take out a loan after repaying a previous loan, or if I want to extend or renew a payday loan, what is the maximum a payday lender can charge me?

If a payday lender agrees to advance you another payday loan within seven days of repaying a previous payday loan or agrees to extend or renew your existing payday loan,the maximum that the payday lender can charge you is 5% of the principal amount of the loan (or $5 per $100 borrowed).

Example:

You take out a loan for $300.00 and it is due on May 19th. For this first loan you are charged 17% of the principal amount of the loan (or $17 per $100 borrowed) and must repay $351.00.

     

A W M a th 11 Name:  

Vanier Mathematics

 11

Questions:

1. What is a payday loan? Can you name a company that offers a payday loan? (2 marks)

2. Why are payday loans such a profitable business? Look at the APR (%)

in the reading above! (The annual percent interest on a typical bank or car loan ranges from 2% - 10% right now.) (2 marks)

3. What does MNI stand for? (1 mark)

4. Find net pay, if MNI = $1500. Use the formula in the reading above. (2 marks)

5. Calculate interest if you get a bank loan for $1000.

Use the formula I = Prt. (2 marks)

• The principal is $1000 • the rate is 7% (use as a decimal in formula, so r = 0.07) • time is 1 yr (so use t = 1 in formula)

A W M a th 11 Name:  

Vanier Mathematics

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6. You are considering applying for a short-term payday loan. (4 marks) a) Find your net pay using the formula in the article. Show your work

below. Use MNI = $1300 (2 marks) b) Find the most you can borrow, which is 30% of your net pay. Show

work. c) Find the most the lender can charge you, which is 17% of what you

borrow. Show work.

d) How much will you have to repay? This value will be what you borrowed plus interest.

 

A W M a th 11 Name:  

Vanier Mathematics

 13

DAY 3 Simple Interest class notes Simple Interest

To find the simple interest earned: I  =  Prt  

To find the final value: A  =  P  +  I  

Principal Term Rate HOW TO Solve Problems Involving Simple Interest STEPS Example 1:

How much interest is earned on an investment of $5000.00, at 3.00% per annum over a 2-year term?

Example 2: If the interest earned is $45.00 and the rate is 4% for 3 years, calculate the principal that was invested.

1. Write your formula

2. Write your ‘knowns’

3. Insert your ‘knowns’

4. Solve algebraically (do the opposite!)

A W M a th 11 Name:  

Vanier Mathematics

 14

DAY 3 Simple Interest assignment

1. Calculate the amount of simple interest earned on each of the following principal amounts at the rate and term given. a. Principal: $1000.00, Rate: 2.50% per annum, Term: 1 year

b. Principal: $1000.00, Rate: 5.00% per annum, Term: 1 year

c. Principal: $1000.00, Rate: 2.50% per annum, Term: 2 year

d. Principal: $2000.00, Rate: 2.50% per annum, Term: 1 year

e. What happens to the interest earned if any ONE of the 3 variable double? What would happen if you doubled each of rate, time, and principal?

2. Calculate the value of an investment of $600.00 after 5 years, invested at a simple interest rate of 3.75% per annum.

3. How much money would you have after 10 years if you deposited $1000.00 at a rate of 4.50% simple interest per annum?

A W M a th 11 Name:  

Vanier Mathematics

 15

4. Find the annual rate of interest if the interest earned is $515.00 on a principal of $4500 for 4 years.

5. You put $2500 into a savings account that earns 3.5% interest annually. What is the total money that will be in the account after 6 years?

6. Betty loaned $6000.00 to her sister at an interest rate 5%. Her sister gave her $6825.00 to pay the loan back. How long in years did Betty have to wait to get paid?

7. Susan borrows $8650 to buy a used car and is charged 4.5% interest. If the term of her borrowing is 5 years, how much interest does she pay in total?

8. If Sheila paid $797.50 in interest on a 5 year loan of $5800.00, what was the interest rate?

9. You invest $1250 in Savings Bond A that earns 4% interest annually. After 3 years you ‘cash out’ the Savings Bond A and take all that money and invest in Savings Bond B that earns 5.5% interest annually. After 4 years you ‘cash out’ Saving Bond B to buy a car. How much money do you have to buy a car?

Remember to use the steps! • Write your formula

• Write your ‘knowns’

• Insert your ‘knowns’

• Solve algebraically

(do the opposite)

A W M a th 11 Name:  

Vanier Mathematics

 16

DAY 4 Rule of 72 class notes Rule of 72

To find the find the time it takes to double you investment:

! =72!  

R  is the annual interest rate expressed as a percent T  is the time for the investment to double HOW TO Use the Rule of 72

1. Leave the interest rate as a percent 2. Divide 72 by the interest rate 3. This is the time it will take for the

investment to double EXAMPLE 1 Finding the Doubling Time Approximately how long will it take an investment of $5000.00, invested at a rate of 3.75% per annum, compounded annually, to double in value? EXAMPLE 2 Finding the Interest Rate If you wanted to double your money in 10 years, at what interest rate would you need to invest your money?

Remember to use the steps! 1. Write your formula 2. Write your ‘knowns’ 3. Insert your ‘knowns’ 4. Solve algebraically

(do the opposite)

A W M a th 11 Name:  

Vanier Mathematics

 17

DAY 4 Rule of 72 assignment

1. Use the Rule of 72 to estimate how long it would take the following investments to double in value:

a. $6000.00 invested at 4.00% per annum, compounded annually

b. $1000.00 invested at 2.45% per annum, compounded annually

c. $1000.00 invested at 1.95% per annum, compounded annually

2. If you wanted to double your money in 15 years, at what rate of interest

would you need to invest your money?

3. Calculate the amount of simple interest earned and the final value of each of the following investments.

a. Principal: $400.00, Rate: 1.25% per annum, Term: 8 years

b. Principal: $750.00, Rate: 2.75% per annum, Term: 5 years

c. Principal: $1000.00, Rate: 4.50% per annum, Term: 10 years

d. Principal: $1200.00, Rate: 3.95% per annum, Term: 9 years

A W M a th 11 Name:  

Vanier Mathematics

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4. Use the table to show how much a deposit of $1000.00, invested at 3.85% per annum, compounded semi-annually for 2 years, would be worth at the end of each compounding period.

INTEREST TABLE

Interest period

Investment value at beginning or

period

Interest earned (I  =  Prt )

Investment value at end of period

5. An investment offers a rate of 2.80% per annum, compounded annually.

a. Use the Rule of 72 to determine about how long it will take for the value to double. Round your answer to the nearest whole year.

Quiz 5.1 will now be given.