1. Entrance Ticket What do you think about Charlie Hebdo’s response to the attacks? It says, “"They got the weapons -- Screw them, we got the Champagne!"

2. Other Updates ---Governor Raimondo’s response: “If a request is made [to help with refugees], we will coordinate closely with the White House…” ---Germany-Netherlands soccer game canceled after threat ---2 flights from Paris to LA were sent instead to Salt Lake City ---France has continued airstrikes on parts of Syria, targeting ISIS bases

3. Agenda 1)Introduction to Simple Interest & APR/APY 2)Practice Problems

4. Time & Money Which would you rather have and why: $200 upfront, $150 more in 1 year, $100 more in 2 years OR $100 upfront, $150 more in 1 year, $200 more in 2 years

5. Bank pays you interest to borrow your $$ Savings accounts, retirement accounts, etc. HIGH interest rates better = Banks pay you MORE  You pay interest to the bank/govt. for borrowing their $$ Loans (college, car, home, etc.) LOW interest rates better = you pay back LESS

6. Which interest rate is better? Citizens Bank offers 2% interest rate on a savings account. Santander Bank offers 4% interest rate on a savings account. Circle the best interest rate!  U.S. govt. offers 3.4% interest rate for college loans. Chase bank offers 6.8% interest rate for college loans. Circle the best interest rate!

7. How do I calculate how much interest I earn/pay? Simple Interest Formula =P x r x tI Amount of Interest I earn/pay Principal (starting $$ amount) Rate (change % to decimal) f Interest 25% .25 Time (in years)

8. How do I calculate my account balance if I’m earning interest? = I + P B total Balance in account Interest earned Principal (starting $$ amount)

9. Changing % to decimalsChanging months to years Divide by 100 OR Move decimal point 2 units to the LEFT 5% = 25% = 83% = Divide by 12 months 24 mo. = 6 mo. = 18 mo. =

10. Changing % to decimals Changing months to years 5% = 5/100 =.05 25% = 25/100 =.25 83% = 83/100 =.83 24 mo. = 2 years 12 mo. 6 mo. =.5 years 12 mo. 18 mo. = 1.5 years 12 mo.

11. I = interest earnedP = principalr = interest rate (in decimal form)t = time (in years) B = total balance I = Prt B = I + P I = Prt  P = I = Prt  r = I = Prt  t =

12. EXAMPLE 1 Jahayra invests $725 into savings account that pays 2.3% interest. How much interest will Jahayra earn after 18 months? P =r =t =I = I = ($725)(0.023)(1.5) I = $25.01 What will Jahayra’s balance (B) be after 18 months? B= P + I B= $725 + $25.01 B= $750.01

13. If Jaime earns $2715 in interest over 10 years in an account earning 3% interest, find the principal he first deposited and the amount. I = Prt  P = ($2715)/(.03)(10) P = $9050 What will Jaime’s balance be after 10 years? B= P + I B= $9050 + $2715 B= $11,765 P =r =t =I =

14. Classwork / Homework: finish simple interest problems # 1 - 10

15. APR vs APY APR = Annual Percentage Rate APR = Rate x Number of Periods Ex. 1% x 12 months = 12% APR ***Does not take into account compounding interest APY = Annual Percentage Yield APY = (1+Rate)^ Number of Periods -1 Ex. (1+0.01)^ 12 -1 = 12.68% APY

16. Exit Ticket What is interest? What are the two ways it can affect you? When would it benefit you to have a high interest rate? When would it benefit you to have a low interest rate?

17. So… While APR is the interest rate charged toward the principle of your mortgage, APY is the percentage of the principle you’ll have to pay over the course of the year, factoring in compounding interest. Every time the interest on your loan is charged, the total amount the lender earns from interest increases. So while your APR may only be 3.9%, your loan may accrue 4.2% in interest charges over the year, making your APY higher than your APR.