WEEK 31-CREDIT,-LOANS-AND-INVESTMENTS

Credit, Loans and Investments

Start

Objectives

Investments

Summary

Amortization Tables

Credits & Loans

Story

Story

Credits & Loans

For investments

Credit is the ability to borrow money with the promise of repayment, typically with interest.

For spending in goods and services

Money borrowed can be used for many purposes

Revolving Credit

Open Credit

Installment Credit

Types of Credit

In a loan a lender gives a borrower a set amount of money that must be repaid with interest over a predetermined time.

Secured loan used to purchase real estate.

Financial aid to help education expenses, tuition, living costs

Example 2: Mortgage

Example 1: Student Loan

A good credit score is above 700

They use credit score to evaluate your ability to pay:

Financial entities need to know if you're eligible for taking a credit.

Investments

Fixed Deposits

Real State

Investments involve allocating money into assets with the expectation of generating a return.

Stocks

Any citizen can invest in:

the use of a diversified portfolio can help mitigate risks.

Depending on the amount of capital you'd invest in,

Amortization Tables

breaking down principal and interest.

Here: P=$200,000 r=4% PMT=$199 n=6 months t=1month (monthly)

Example: For a $1,000 credit card loan at 4% over 6 months, the monthly payment is approximately $199.

An amortization table details each payment on a loan over time,

Example 1: Let's create an amortization table for the credit card loan discussed before.

Amortization table

Summary: Finance

stocks

Real state

Fixed deposits

revolvenment

open

loans

Installment

investments

credits

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Welcome 6th graders!

MA.912.FL.3 Describe the advantages and disadvantages of short-term and long-term purchases. MA.912.FL.3.3 Solve real-world problems involving present value and future value of money. MA.912.FL.3.4 Explain the relationship between simple interest and linear growth. Explain the relationship between compound interest and exponential growth and the relationship between continuously compounded interest and exponential growth. ELD.K12.ELL.MA.1 English language learners communicate information, ideas and concepts necessary for academic success in the content area of Mathematics. ELA.K12.EE.3.1 Make inferences to support comprehension.

• Grid paper.
• Pencils of different colors.
• Eraser.
• A rule.
• A calculator.
• Geogebra installed on your phone/tablet/computer (or use online version).

MATERIAL

It is highly advised to have: