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CALCULATING SIMPLE INTEREST LESSON PLAN TEACHING MONEY CONCEPT LEARNING FINANCE ECONOMIC BUSINESS MATH ACTIVITY SAMPLE EXAMPLE HELP STUDENTS PRACTICE TEACHER FINANCE SKILLS ONLINE COURSE

 

 

 

Students learn how to calculate simple interest.

 
 

SIMPLE INTEREST

Concept:  Understand what simple interest is and how it is calculated.

Objectives:

  1. Know and use simple interest terminology
  2. Understand when interest is paid
  3. Understand when interest is earned
  4. Know and use the formula for calculating simple interest
  5. Know and use the formula for calculating the total amount of a loan or total value of an investment at the end of a specified term
  6. Understand how to algebraically manipulate the interest formulas to solve for different variables

Suggested Grades:

Ninth Grade - Tenth Grade - Eleventh Grade - Twelfth Grade - Adult Education - Business Education

 

 

CALCULATING SIMPLE INTEREST LESSON PLAN

 

Teaching Materials

  • Lesson - Simple Interest  (see below for printable lesson)

  • Overhead

  • Many pre-calculated interest examples

 

Lesson Activity

  1. Ask class what interest is
     
  2. Note how many respond with paid interest versus earned interest
     
  3. Define it first as the amount charged to borrow money
     
  4. Discuss specific examples: car loans, mortgage loans, vacation loans, etc..
     
  5. Discuss when simple interest might be used (i.e. short term) and explain that it is a very simple way to calculate interest and mention that banks and other lending institutions usually use compound interest which will be discussed later.
     
  6. Discuss the three elements that are involved (principal, rate, term)
     
  7. Define each term
     
  8. Introduce the interest formula:  I=Prt

  9. Work through examples
     
  10. Talk about total amount due:  A = P + I
     
  11. Introduce the total amount formula:  A = P * (1+ rt)
     
  12. Work through examples
     
  13. Introduce earned investment and define the terms accordingly
     
  14. Work through examples
     
  15. Present a problem with a variable other than interest – ask class to think of ways to solve
     
  16. Discuss the interest table
     
  17. Present the different algebraic formulas and work through how they are derived
     
  18. Work through examples

 

Assessment/Evaluation
Have students complete worksheet. A passing grade is 70% or greater. 

 

 

Lesson Printable Materials - Worksheets

Print out the teaching lesson pages and exercise worksheets for use with this lesson:

 

SIMPLE INTEREST LESSON

Simple Interest Lesson and Worksheet

Lesson and worksheet.
 

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