Compound Interest Teacher Resources
Find Compound Interest educational ideas and activities
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Sal continues to look at changing the length of compounding time, from daily to hourly compounding interest. Now he is able to show that compounding 100% annual interest converges on the number 2.71É or e as the number of compounding periods becomes a bigger and bigger number.
Continuing with the lesson on compound interest, in this video, Sal derives the general formula for any amount of principle, interest rate, and compounding periods over one year.
Young scholars apply the formula to solve problems with compound interest. In this algebra lesson, students define continous growth rate, decay and growth as it relates to exponential functions and Principal, Interest and Rate as it applies to money problems.
Provide a real world context in which exponential functions are used to determine a eal world phenomena such as compound interest and exponential growth. This lesson should be taught after students have mastered the laws of exponents and are able to explain what an exponential graph looks like.
Students investigate simple and compound interest. In this Consumer Mathematics lesson, students use the TI-nspire handheld to compare simple and compound interest. The lesson includes problem solving and graphing of results.
View this tutorial for more than just a description of the formula for compound interest! An instructor goes through a problem, showing how to find simple interest and compound interest. After she completes each version, she explains the difference and provides the formula for compound interest. A great tool for strengthening understanding of interest.
Here is a simple tutorial on the difference between simple and compound interest. In it, Sal describes what interest is, defines the vocabulary of principle and interest rate. He also models year-by-year the amount of money owed under the different compounding scenarios.
Middle schoolers need to learn how to make their money work for them. From engaging in the lesson presented here, they will gain an understanding of investment vocabulary, how compound interest works, and will compute simple and compound interest in simulated investment scenarios. The lesson is a fine example of how to build real-life skills into your daily teaching. A terrific teaching idea!
Another example of simple interest and compound interest (compounded yearly) is explored in this video.
Many math concepts are covered through this resource: percentages, decimals, ratios, exponential functions, graphing, rounding, order of operations, estimation, and solving equations. Colorful worksheets and a link to a Google search for fractals images are included. Note that the lesson plan states it is the second of five lessons in an investing unit, but the other pieces were not located on the publisher's website. The lesson does, however, hold plenty of value on its own.
Paper folding, flu spreading in a school, bacteria growth, and continuously compounded interest all provide excellent models to study exponential functions. This is a comprehensive resource that looks at many different aspects of these applications including creating tables, graphs, and equations. Use part or all of this great resource.
Students examine the concepts of trade-offs and opportunity cost to decide between savings accounts with simple interest and those with compound interest. They calculate interest earned on account balances while working in groups and make a decision on which is the best option.
Students compute and collect interest payments in the form of M&M candies. In this mathematics lesson, students work in small groups to compute either simple or compound interest. They compare the growth of their accounts after six cycles. A recommendation to "pay" the students in M&M candies is made to make the lesson more interesting for the students.
Young scholars explore the concept of compound interest. In this compound interest lesson, students are given a scenario where they must create a recursive function to represent the scenario. Young scholars calculate the interest after given intervals of time.
Learners explore different methods of saving. In this Economics/Consumer Math lesson plan, students use follow-along worksheets to calculate simple and compound interest and explore and compare different methods of saving.
High schoolers explore the concept of personal finance. In this philanthropy instructional activity, students examine decisions they make about money as they discover the definitions of philanthropy, resources, scarcity, choice, benefits, costs, opportunity cost, interest, interest rate, principal, simple interest, compound interest, and compounding.
Young scholars investigate way in which to save money, create financial goal, and predict what inflation do to money saved. They study the differences between simple and compound interest.
Eleventh graders calculate compound interest for real-life situations. They begin calculating interest using a recursive function in problem situations. Once they understand this iterative process, they translate the function into a formula.
Young scholars explore saving and investing money. In this middle school personal finance lesson, students define and use investment vocabulary, explore compound interest and its effect of savings, and compute simple and compound interest. Young scholars compare and contrast annual percentage rate and annual percentage yield.
Young scholars explore the concept of compound interest. For this compound interest lesson, students determine compound interest on 100 dollars at 3% over time. Young scholars construct a formula for their table of values from the 100 dollars. Students discuss the risk involved with a credit card.