Business Math:  Loans and Interest Rates

Two Week Outline

Lesson 1

• Introduce topic and explain what will be expected of each student.

• Provide this list of Internet sites for them to look at and use in their projects.

• Provide each student with handout of required information to turn in at end of two weeks.  Sample handout.

Lesson 2

• Briefly cover payroll using examples and then doing the problems or make up your own.

• Cover simple interest, compound interest, and present value.

• Use some Internet sites that show how to calculate interest and monthly payment amounts.

• Show students how to figure total amount of interest paid.  Define APR and APY.

• Have the students do some sample problems.

Lesson 3

• Discuss budgets and show students a sample budget.

• Discuss how payroll, loans, and interest are used to determine budgets.

• Let students use Internet to find a job they want.

• Paycheck Calculations.

  • Have students determine how much they would get paid monthly with taxes.

  • Then have them determine how much they will have taken out in taxes.

  • Finally, have them determine yearly income without taxes.

• Have them prepare a chart with Job Title, Job Location, Monthly Income, Taxes Taken Out, Monthly Net Income, and Yearly Net Income.

Lesson 4

• Today the students will be finding houses/places to live, cars, and other expenses they will experience while living on their own.

• Students will do research for this information on web sites or by calling and asking questions for the area they chose their job is located.

• Once they have determined all these factors, then they will need to find a loan through either one of the local banks or other lending services.  This should be done on-line.

• They will need to print out all this information and show where they got the information.  (Do not forget that living prices can be higher elsewhere).

Lesson 5

• Now that the students have their loans they must use one of the web sites that shows monthly payment.

• They also need to figure out total amount they need for the loan.  They can have more than one loan for house/car.

• They will then figure out how much they will pay in interest and how much they will end up paying at the end of the loan.

• Remind the students that while choosing a loan they need to stay with in their budget.

Lesson 6

• The students should now have all the information necessary to make a budget.

  • The students can choose to make the budget look any way.

  • Remind them it must be typed.

  • It must show all income and the break down.

  • It needs to show any savings they will have.

  • The budget should contain all expenses including food, utilities, gas, entertainment, and miscellaneous expenses.

  • They will need to show their loan(s) in total along with monthly payment.

Lesson 7

• Have students finish their budgets and get their information ready to present to the class.

• The requirements for the presentation may differ – sample requirements.

• Have students draw numbers to pick the order for the presentations.

Lesson 8

• Presentation of project.