Simple and Compound Interest
9th Grade · Math · 45 min
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Learning Objective
I can calculate simple and compound interest and explain the difference between them.
- 1
Simple interest grows in a linear fashion, adding the same amount every year, and can be represented by the equation y = mx + b.
- 2
Compound interest grows exponentially, multiplying by the same number every year, and is represented by the equation y = a(1 + percent)ˣ, where 'a' is the starting value.
- 3
To convert a percentage to a decimal, divide the percentage by 100; for example, 8% becomes 0.08.
