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Warm- up

Warm- up. Better Deal Problem of the day…. Lesson 8.3 Installment Loans and Monthly Payment &Finance Charges. Page 311 Objective: Calculate monthly payment, finance charges, and total repaid. Key Terms. Installment loans- repay over a set period of time using fix equal payments

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Warm- up

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  1. Warm- up Better Deal Problem of the day….

  2. Lesson 8.3 Installment Loans and Monthly Payment &Finance Charges Page 311 Objective: Calculate monthly payment, finance charges, and total repaid

  3. Key Terms • Installment loans- repay over a set period of time using fix equal payments • APR- annual percentage rate, index showing the cost of borrowing money on a yearly basis, expressed as a percentage.

  4. Formulas • Using the graphics calculator • Total amount repaid = number of payments x Monthly payment • Finance Charge = Total amount repaid – amount financed (amount borrowed)

  5. Graphic Calculator lab – Page 313 • Use of the graphic calculator to solve simple personal finance problems. • Follow steps: • Complete think and discuss,

  6. Example ONE PAGE 311 • Use Graphic Calculator • N = 12 • I = 12 • PV = 1399.99 x .90 • PMT = Solve • FV = 0 • P/Y and C/Y = 12 (payments based on 12 payments per year)

  7. Complete Chart on page 314 • Problems 3, 4, 5 • Guided practice • Solve parts b, c, d, not a. • 3. 171.56, 1029.60, 29.60 • 4. 121.96, 2196.00, 196.00 • 5. 253.12, 6074.88, 474.88

  8. Complete Problems 7 ,9, 11,13 • Answers in the back of the book

  9. Closure • What effect does the APR have on the finance charges? • Does it make sense to shop around for better rates?

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