LAS - Gen Math Week 1
LAS - Gen Math Week 1
Department of Education
Region XIII-CARAGA REGION
SCHOOLS DIVISION OF SURIGAO DEL SUR
Lanuza District
Grade Level: 11 Discipline: Business Math
Subject Area: General Mathematics Topic: Simple and Compound Interests
Quarter : First Week: 1 - January 4-8, 2021
Objectives:
K-1. Illustrate Simple and Compound Interest.
2. Distinguish between Simple and Compound Interest.
S- Calculate Simple and Compound Interest problems.
A- Value the importance of Simple and Compound Interest.
Interest is the fee paid for borrowed money. We receive interest when we let others
use our money (for example, by depositing money in savings account or making a loan).
We pay interest when we use other people’s money (such as when we borrow from a
bank or a friend). It is usually expressed as a percentage either simple or compounded.
You might ask a question like this, am I a Receiver or a Payer? Also, what kind of
interest will I take? Simple interest or Compound interest?
In this chapter we will study simple and compound interest. Simple interest is an
interest that is computed on principal and then added to it, while Compound interest is
computed on the principal and also on the accumulated past interests. Maturity Value is
computed by adding the interest on the principal.
We provided you this learning activity sheet because we will try to illustrate first
how simple interest and compound interest differ. But, before that let us take some
examples of illustrating simple and compound interest and how it is computed.
So, hopefully you will always find interest in mastering the stuff in this chapter and do
not forget to practice proper hygiene.
Example:
Suppose you won P5,000.00 and you plan to invest it for 5 years. A corporate
group offers 2% simple interest rate per year. A bank offers 2% compounded annually.
Calculate the amount of interest from a corporate group and a bank.
Simple Interest
Given:
Principal = P5,000.00
Rate = 2% or 0.02(2/100) annually
Time = 5 years
Solution:
P 5,000.00× 0.02× 5=P 500.00
P 5,000.00+ P500.00=P5,500.00
Having the principal amount invested from the corporate group that offers 2% or
0.02 per year then you will have P500.00 as the interest. Therefore, in 5 years of
investment you will get a total amount of P5,500.00. That is how Simple Interest works.
Compound Interest
Given:
Principal = P5,000.00
Rate = 2% or 0.02 (2/100)
Time = 1 (compounded annually)
Solution:
Since, it is compounded annually so it will go like this;
Guide Question:
Process:
Directions: Analyze and illustrate the given situation using the table provided and
answer the questions that follow.
1. Suppose you want to invest php 10,000.00 in the bank for 6 years. The Land Bank
of the Philippines (LBP) offers 12% annual simple interest rate per year. The East
West Bank offers 12% compounded annually.
1
2
3
4
5
6
Time Amount at the start Rate Compound Interest (Ic) Amount after t
(t) of year t I SOLUTION ANSWER years
(maturity value)
1
2
3
4
5
6
2. What is the difference between the simple interest and compound interest based
on the activity you had?
3. How do you find simple interest? Express your answer using symbols or in
formula.
4. How do you find compound interest? Express your answer using symbols or in
formula.
Reflection:
1. How did you find the activity?
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References:
Activity 2.
SIMPLE INTEREST (Annual)
Time Principal Interest Simple Interest Amount after t years
(t) (P) Rate (r) (maturity Value)
Solution Answer
5 P 5,000.00 4% P 5,000.00 P 1,000.00 P5,000.00+1,000.00
(0.04)(5) =P 6,000.00
6 P 5,000.00 4% P 5,000.00 P 1,200.00 P5,000.00+1,200.00
(0.04)(6) =P 6,200.00
7 P 5,000.00 4% P 5,000.00 P 1,400.00 P5,000.00+1,400.00
(0.04)(7) =P 6,400.00
8 P 5,000.00 4% P 5,000.00 P 1,600.00 P5,000.00+1,600.00
(0.04)(8) =P 6,600.00