1. Is anyone a millionaire?
Are you a millionaire yet?
Is anyone a millionaire?

2. Starter: Investing your Money
Four banks have accounts for ‘would be millionaires’
For a specific investment amount, they have interest rates
that guarantee you will be a millionaire in just one year! C
% increase over 1 year
Bank
Investment
Interest Rate pa
Natwest €
0.25%
Barclays €
0.50%
HSBC €
0.75%
Co-operative €
1.00%
New Savings
Accounts
Using Simple Interest, how much money would you have after 1 year? (final amount)

3. Eeekkk! Seems the banks got it wrongZ
Eeekkk! Seems the banks got it wrong
A review by the Senior 3 Maths Authority has highlighted an error with the ‘would be millionaire’ accounts – they don’t make you a millionaire
The banks’ money men say it was a typo in the offer, they actually guarantee you will be a millionaire after 2 years
Bank
Investment
Interest Rate pa
Natwest €
0.25%
Barclays €
0.50%
HSBC €
0.75%
Co-operative €
1.00%
Work out your interest after 2 years..
Are you a millionaire yet?

4. Hmmm it’s still not working!!Z
Hmmm it’s still not working!!
The Senior 3 Maths Authority are angry, these accounts are still not making them actual millionaires!
Bank
Investment
Interest Rate pa
After 2 Years
Natwest €
0.25% €
Barclays €
0.50% €
HSBC €
0.75% €
Co-operative €
1.00% €
Now the bank’s men are saying your calculations are wrong, its based on compound interest, not simple interest
What can compound interest be and how it might be calculated?

5. Compound Interest Compound Interest Simple Interest
Calculated at a fixed rate on
principal amount + interest
Principle amount changes every year
Interest changes every year!
Simple Interest
Calculated at a fixed rate on the principal amount
Remains the same every year!

6. Compound Interest
Find the compound interest on €3000 invested for 2 years at 5% per annum.
Total interest = €150 + € = €307.50
Principal
Interest
Year 1
€3000
5% of €3000 = €150
Year 2
€ €150 = €3150
5% of €3150 = €157.50
New Principal

7. €14,000 is invested at 9. 25% per annum compound interest
€14,000 is invested at 9.25% per annum compound interest. Find the total amount at the end of 3 years.
Total Interest = = €
Final Principal = = €
Principal
Interest
Year 1
€14000
9.25% of €14,000 = €1295
Year 2
€ €1295 =
€15295
9.25% of €15295 = €
Year 3 = €
9.25% of € = €

8. Compound Interest – making you a millionaire!
Now you can calculate the compound interest on your investment over two years!
Hopefully you are now a millionaire! 