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Calculating Percentages

Int 2

Simple Interest / Compound

Compound Interest

www.mathsrevision.com

Appreciation / Depreciation

Inflation / Working back

Starter

Int 2

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Calculating Percentages

Int 2

Compound Interest

Appreciation More

Simple Interest

Just Calculating Percentages

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Depreciation Less

Inflation Rising Prices

Working backwards

Calculating Percentages

Int 2

Learning Intention

Success Criteria

- To know the meaning of the term simple interest.

- To understand the
- term simple interest and compound interest.

- To know the meaning of the term compound interest.

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3. Know the difference between simple and

compound interest.

Calculating Percentages

Just working out percentages

Int 2

Simple Interest

I have 400 in the Bank. At the end of each year

I receive 7 of 400 in interest. How much

interest do I receive after 3 years. How much do

I now have?

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Calculating Percentages

Int 2

Now try Exercise 1 Ch2 (page 8) Odd Numbers

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Calculating Percentages

Interest calculated on new value every year

Int 2

Compound Interest

Real life Interest is not a fixed quantity year

after year. One years interest becomes part of

the next years amount. Each years interest is

calculated on the amount at the start of the year.

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Principal value

Calculating Percentages

Interest calculated on new value every year

Compound Interest

Int 2

Daniel has 400 in the bank. He leaves it in the

bank for 3 years. The interest is 7 each year.

Calculate the compound interest and the amount he

has in the bank after 3 years.

Y1 Interest 7 of 400 28

Simple Interest

Amount 400 28 428

Interest 7 of 400 28

Y 2 Interest 7 of 428 29.96

3 x 28 84

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Amount 428 29.96 457.96

Y 3 Interest 7 of 457.96 32.06

Amount 457.96 32.06 490.02

Compound is 490.02 - 400 90.02

Simple Interest is only 84

Calculating Percentages

Int 2

Now try Exercise 2 Ch2 (page 8 9)

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Starter

Int 2

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Calculating Percentages

Int 2

Learning Intention

Success Criteria

- To calculate compound interest using calculator..

- To understand how to use the calculator to

calculate compound interest easier.

- Show appropriate working
- when solving problems.

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Calculating Percentages

Int 2

This is called the multiplier.

Using a calculator to do Compound Formula

n period of time Days, months years

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I initial value

IMPORTANT Can only use this when percentage is

fixed

increase or decrease

V Value

Calculating Percentages

Int 2

Using a calculator to do Compound questions

Calculate the money in the bank after 3 years if

the compound interest rate is 7 and the initial

value is 400.

n 3

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I 400

increase 10.071.07

V 400 x (1.07)3 490.02

Calculating Percentages

Int 2

Using calculator to calculate Compound questions

In a jar bacteria grows 4 every hour. Initially

there were 200 bacteria in the jar. How many

bacteria are in the jar 4 hours later.

n 4

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I 200

increase 10.041.04

V 200 x (1.04)4 234

Calculating Percentages

Int 2

Using calculator to calculate Compound questions

A car reduces in price by 14 each year.

Initially it cost 12 500. much is it worth 5

years later.

n 5

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I 12 500

increase 1-0.140.86

V 12 500 x (0.86)5 5880.34

Calculating Percentages

Int 2

Now try worksheet

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Starter

Int 2

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Calculating Percentages

Int 2

Learning Intention

Success Criteria

- To know the terms appreciation and depreciation.

- To understand the terms appreciation and

depreciation.

- Show appropriate working
- when solving problems containing appreciation

and depreciation.

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Calculating Percentages

Int 2

Appreciation / Depreciation

Appreciation Going up in value e.g. House value

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Depreciation Going down in value e.g. car value

Quicker Method Easier 1.79 x 64995 116341.05

- Average house price in Ayr has appreciated by

79 over past 10 years. - If you bought the house for 64995 in 1994 how

much would the house be worth now ? - Appreciation 79 x 64995
- 0.79 x 64995
- 51346.05
- New value Old Value Appreciation
- 64995 51346.05
- 116341.05

Just working out percentages

Calculating Percentages

Int 2

- A Mini Cooper cost 14 625 in 2002
- At the end 2003 it depreciated by 23
- At the end 2004 it will depreciate by a further

16 - What will the mini cooper worth at end 2004?
- End 2003
- Depreciation 23 x 14625
- 0.23 x 14625
- 3363.75
- New value Old value - Depreciation
- 14625 - 3363.75
- 11261.25

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Calculating Percentages

Int 2

- End 2003
- Depreciation 23 x 14625
- 0.23 x 14625
- 3363.75
- New value Old value - Depreciation
- 14625 - 3363.75
- 11261.25
- End 2004
- Depreciation 16 x 11261.25
- 0.16 x 11261.25
- 1801.80
- New Value 11261.25 - 1801.80
- 9459.45

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Calculating Percentages

Int 2

Now try MIA Ex 4 Ch2 (page 12) Odd Numbers

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Starter

Int 2

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5cm

6cm

Calculating Percentages

Int 2

Learning Intention

Success Criteria

- Know the term inflation.

- Understand term inflation
- and work out associated real-life problems.

- Work out real-life problems involving inflation.

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Calculating Percentages

Measure of how much prices rise each year.

Int 2

Inflation

Inflation is normally given in percentage form

and is normally in the range 0 10

Example 1

In 2004 a worker received a wage of 300 per

week. If inflation is 2 in 2004, what should be

his wage be in 2005.

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2004 inflation 2

2 of 300 6

His wage should be 300 6 306

Calculating Percentages

Measure of how much prices rise each year.

Int 2

Inflation

Inflation is normally given in percentage form

and is normally in the range 0 10

Example 2

In 2002 a CD cost 8. The cost increases in line

with inflation. What is the price in 2003 if

inflation is 1.5.

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2002 inflation 1.5

1.5 of 8 0.12

Price is 8 0.12 8.12

Calculating Percentages

Int 2

Now try MIA Ex 6 Ch2 (page 15)

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Calculating Percentages

Int 2

Reversing the change

Example 1

After a 10 increase the price of a house is 88

000. What was the price before the increase.

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Calculating Percentages

Int 2

Reversing the change

Example 2

The value of a car depreciated by 15. It is now

valued at 2550. What was its original price.

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Calculating Percentages

Int 2

Now try MIA Ex 7 Ch2 (page 17)

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