NCTM Standards: Represent and analyze mathematical situations and structures using algebraic symbols; Understand patterns, relations and functions
Activity 5: Growing the GreenAdded on 10/10/2007 |
Downloads: TI-73 PDF file |
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ACTIVITY OVERVIEW In this activity we will:
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| First set your calculator so that it looks like the screen at the
right. Make sure you change the second line, FLOAT, to 2 by arrowing
over and clicking enter. These settings will output your answers as no
more than two decimal places. |
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If you were given $10,000 and you wanted to double your money in 6 years, what constant interest rate would you need? What approach would you use to figure this out? You should be within $50 or ½% of the increase. |
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| If you doubled your money, it would increase 100%. If you divided the 100% by 6, you get approximately 16.7% Perhaps an annual increase of 16.7% will work. We multiply $10,000 times .167 and add it to the $10,000 to find the amount after one year. See the results at the right. | 
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| Because of COMPOUND interest, the interest for the second year is earned on the $10,000 and the interest earned the first year. You can multiply the $11,670 by 1.167. This will add the result after one year to the interest earned for the second year and give you a second year total. |
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You can then press the multiplication sign( ) . This will bring down the previous result from the end of the second year. Enter 1.167 and press  . You can then press  again. It will repeat the previous command (multiplies the last value by 1.167). Continue this and keep track of the years until you reach the $20,000. |
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If the 16.7% does not satisfy the requirements for the problem, readjust your guess and continue until you get an answer after 6 years within $50 of the target. |
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What if you were more conservative and wanted to double your $10,000 in ten years? Use what you have done from the problem above to come up with the annual percent to accomplish this. |
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