Unit 20 · Simple Interest
Simple Interest
Mathematics · Grade 7
What You Will Be Able To Do
🧮Work out interest from the principal, the rate and the time
📅Convert months into years before anything goes into the formula
🔄Rearrange the formula to find the rate, time or principal
📈Explain why simple interest falls behind an account that grows on itself
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Interest is rent paid for money. The word simple means the rent is charged only on the original sum, never on the interest that has already built up.
Presenter notes: Open with a question that grounds the whole topic. If you lend a friend your bicycle for a month, is it reasonable to expect something in return? Most will say yes, and that is exactly what interest is: a payment for the use of something, in this case money, for a length of time. Then ask what a bank actually sells, and let the class arrive at the answer that it sells the use of money.