Page 206 - Mathematics GRADE 9, DE-STREAMED (MTH1W)

Teacher Prompts
• What effect will increasing or decreasing each of the following have on the overall cost (of goods or services)?
o the interest rate
o the length of the borrowing time
o the frequency at which interest is calculated o the amount of a down payment
• Why does increasing the length of the borrowing time increase the total cost of an item?
• How does a lower interest rate compounded monthly compare to a higher interest rate
compounded annually?
Sample Tasks
1. Provide students with a chart similar to the one below. Have them indicate whether certain changes in variables would increase or decrease the overall cost of an item and explain why. Encourage students to use an online or handheld financial calculator to test their ideas.
Variable
Change in variable
Effect on cost (circle one)
Explanation
interest rate
loan term length
amount of down payment
increase increase increase
Increase / decrease / remain the same
Increase / decrease / remain the same
Increase / decrease / remain the same
2. Ask students to choose an item they might want to purchase sometime in the future (e.g., computer, gaming system, used vehicle, bicycle). Have them use a financial calculator to explore the effects of changing the conditions of a loan to purchase the item, such as the interest rate or term length.
3. Provide students with a sequence of code to calculate the total cost and interest paid on a loan that has interest compounded monthly. Have students alter the code to explore how changing the compounding period (e.g., compounding annually, semi-annually, weekly) would change the total cost and interest for that loan.
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