Do Now 2/21/12Do Now 2/21/12

Take out HW from last night.Take out HW from last night. Text p. 248, #7-16, 19 & 20 Text p. 248, #7-16, 19 & 20

Copy HW in your planner.Copy HW in your planner. Text p. 256, #5-18 all Text p. 256, #5-18 all Quiz sections 6.4-6.6 WednesdayQuiz sections 6.4-6.6 Wednesday

Did you hand in POTW #9?Did you hand in POTW #9?

HomeworkHomeworkText p. 248, #7-16, 19 & 20 Text p. 248, #7-16, 19 & 20 7) 37.5%7) 37.5% 8) 63.6%8) 63.6% 9) 22.2%9) 22.2% 10) 8.7%10) 8.7% 11) $55.2511) $55.25 12) $199.7512) $199.75 13) 100%13) 100%

14) 4.8%14) 4.8% 15) 43.6%15) 43.6% 16) 69.2%16) 69.2% 19) 56.2519) 56.25 20) $8.9620) $8.96

ObjectiveObjective SWBAT compute simple interestSWBAT compute simple interest

the amount of money charged the amount of money charged

for borrowing or using money. for borrowing or using money.

Section 6.6 “Simple Interest”Section 6.6 “Simple Interest”

INTEREST-INTEREST-

the product of the the product of the principalprincipal, the , the

annual interest rateannual interest rate, and the , and the time in yearstime in years..

Principal Principal – the amount – the amount borrowed, loaned, or borrowed, loaned, or

in savings.in savings.

Rate of interest Rate of interest – the – the percent charged or percent charged or

earned.earned.

Time in yearsTime in years – when – when time is less than a time is less than a

year, write time as a year, write time as a fraction of the year. fraction of the year.

SIMPLE INTEREST-SIMPLE INTEREST-

II==PP∙∙ rr∙∙ tt

Writing Time in Years…Writing Time in Years…

4

1

12

3

12

7

trPI Time in yearsTime in years – when time is less than a year, write time as a – when time is less than a year, write time as a fraction of the year. fraction of the year.

Write the months as a fraction of a year.

3 months

6

5

12

10

7 months 10 months

Simple InterestSimple Interest You have $3,000 in a savings account You have $3,000 in a savings account

in a local bank. The annual interest rate in a local bank. The annual interest rate is 3%. How much interest will the bank is 3%. How much interest will the bank pay you in 4 years? pay you in 4 years?

403.03000 I

360$I

Principal = $3000Principal = $3000

Interest rate = 3% or 0.03Interest rate = 3% or 0.03

Time = 4 yearsTime = 4 years

trPI

Simple InterestSimple Interest

You borrowed $18,000 for a new car. You borrowed $18,000 for a new car. The annual interest rate is 12%. What is The annual interest rate is 12%. What is the interest you will have to pay in two the interest you will have to pay in two years to borrow this money? years to borrow this money?

212.018000 I

4320$I

Principal = $18,000Principal = $18,000

Interest rate = 12% or 0.12Interest rate = 12% or 0.12

Time = two years or 2Time = two years or 2

trPI

Determining the Amount of Determining the Amount of Investment TimeInvestment Time

Isaiah invested $3,500 in a mutual Isaiah invested $3,500 in a mutual fund at a yearly interest rate of 6%. He fund at a yearly interest rate of 6%. He earned $945 in interest. For how long earned $945 in interest. For how long was the money invested? was the money invested?

t 06.0500,3945

t210945

Principal = $3,500Principal = $3,500

Interest rate = 6% or 0.06Interest rate = 6% or 0.06

Interest = $945Interest = $945

trPI

t5.4

Account BalanceAccount Balance

When an account earns interest it is When an account earns interest it is added to the money in the account. added to the money in the account. The The BALANCEBALANCE (A) of an account (A) of an account that earns simple annual interest is that earns simple annual interest is the sum of the principal (P) and the the sum of the principal (P) and the interest (I). interest (I).

IPA Balance Principal

Interest

Computing Total Computing Total SavingsSavings

Nadia’s aunt deposited $325 into a Nadia’s aunt deposited $325 into a savings account as a college fund. How savings account as a college fund. How much will be in the account after 8 years much will be in the account after 8 years if the account earns simple interest of if the account earns simple interest of 7%?7%?

A = P+ IA = P+ IA = $325 + $182.00A = $325 + $182.00A = $507.00A = $507.00

I = P ∙ r ∙ tI = P ∙ r ∙ t I = (325)(0.07)(8)I = (325)(0.07)(8) I = $182.00I = $182.00

Calculate interest first. Find account balance.

Finding an Interest Finding an Interest RateRate

Suppose you save $1400 in a savings Suppose you save $1400 in a savings account that earns simple annual account that earns simple annual interest. After 9 months, the balance in interest. After 9 months, the balance in your account is $1421. Find the annual your account is $1421. Find the annual interest rate. interest rate.

Principal = $1400Principal = $1400

Balance = $1421Balance = $1421

Time = 9 monthsTime = 9 monthsI14001421

I21

IPA trPI

The interest rate is 2%The interest rate is 2%

12

9140021 r

r105021

r02.0

HomeworkHomework Text p. 256, #5-18 allText p. 256, #5-18 all

2424

A shoe store in NJ has a sale on A shoe store in NJ has a sale on sneakers for 15% off. If the original sneakers for 15% off. If the original price is$75 what is the total cost of price is$75 what is the total cost of the sneakers with tax? the sneakers with tax?

Sale priceSale price == Original priceOriginal price – – DiscountDiscount

== – – (15(15% · 75)% · 75)

== 7575 – – 11.2511.25

==

7575

$63.75$63.75

Total PriceTotal Price == Purchase PricePurchase Price + + Sales TaxSales Tax

$63.75$63.75 + + (63.75 x 7%)(63.75 x 7%)

$63.75$63.75 + + 4.464.46

$68.21$68.21