Bellringer Calculate the Simple Interest for #s 1 and 3 and the Total cost for #2. 1.$1800 at 3.2% for 4 years. 2. $17250 at 7.5% for 6 years. 3. $3,650 at 7⅞% for 5 years. TALKING = 0% Simple Interest Simple Interest- earnings are paid on a fixed amount of money, or Principal. To calculate Simple Interest, use the formula I = prt, where I is the interest earned, p is the principal (amount invested), r is the interest rate (must be written as a decimal), and t is the time invested in years. Simple Interest Yolanda deposited $3,000 into an account that earns 4½% simple interest annually. Calculate the interest she will earn after six years. How much money will she have in her account? Simple Interest Adrian invested $4700 into a saving account that earns 3.25% simple interest for 7 years. How much interest will be earned after the 7 years and how money will be in the account? Compound Interest Compounded Interest earnings are calculated on the original amount plus accumulated interest. The principal increases each year based on the interest earned. Compound Interest To calculate compound interest, use the formula, (on Page 702), where A is the total account balance, P is the principal, r is the interest rate (expressed as a decimal), n is the number of times interest is compounded per year, and t is the time in years. The finally step is to subtracted the compound interest from the principal. Compound Interest Compound interest can be compounded annually (once a year), semi-annually (2 times a year), quarterly (3 times a year), monthly (12 times a year), and daily (365 times a year). Compound Interest By increasing the amount of times the interest is compounded, the interest that is earned also increases. Writing Prompt Explain the steps you use in a mathematical process we have been studying in this class OR Write about how you or your parents use math in their jobs or everyday life. OR Describe a job/profession that requires math skills and explain how math is used.