Transum Shop ::  Laptops aid Learning ::  School Books ::  Tablets ::  Educational Toys ::  STEM Books

# Comparing Types of Interest

## Understand the difference between simple interest and compound interest by comparing their results

##### CompareLevel 1Level 2Level 3Level 4Level 5Exam-StyleDescriptionHelpMore Finance

Complete the table to show how much £500 is worth when invested with a 4% annual interest rate. Numbers should be to 2 decimal places.

Year Simple Compound

0

£500.00

£500.00

1

£

£

2

£

£

3

£

£

4

£

£

5

£

£

Check

This is Comparing Types of Interest. You can also try the Interest exercise:
Level 1 Level 2 Level 3 Level 4 Level 5

 This activity is suitable for students of mathematics all around the world. Use the button below to change the currency symbol used to make it more relevant to your students. You may wish to choose an unfamiliar currency to extend your students' experience.

## Instructions

Try your best to answer the questions above. Type your answers into the boxes provided leaving no spaces. As you work through the exercise regularly click the "check" button. If you have any wrong answers, do your best to do corrections but if there is anything you don't understand, please ask your teacher for help.

When you have got all of the questions correct you may want to print out this page and paste it into your exercise book. If you keep your work in an ePortfolio you could take a screen shot of your answers and paste that into your Maths file.

## Transum.org

This web site contains over a thousand free mathematical activities for teachers and pupils. Click here to go to the main page which links to all of the resources available.

## More Activities:

Mathematicians are not the people who find Maths easy; they are the people who enjoy how mystifying, puzzling and hard it is. Are you a mathematician?

Comment recorded on the 9 October 'Starter of the Day' page by Mr Jones, Wales:

"I think that having a starter of the day helps improve maths in general. My pupils say they love them!!!"

Comment recorded on the 3 October 'Starter of the Day' page by Fiona Bray, Cams Hill School:

"This is an excellent website. We all often use the starters as the pupils come in the door and get settled as we take the register."

Each month a newsletter is published containing details of the new additions to the Transum website and a new puzzle of the month.

The newsletter is then duplicated as a podcast which is available on the major delivery networks. You can listen to the podcast while you are commuting, exercising or relaxing.

Transum breaking news is available on Twitter @Transum and if that's not enough there is also a Transum Facebook page.

#### Without Lifting

Can you draw these diagrams without lifting your pencil from the paper? This is an interactive version of the traditional puzzle. Some diagrams are possible while others are not. What is the rule?

There are answers to this exercise but they are available in this space to teachers, tutors and parents who have logged in to their Transum subscription on this computer.

A Transum subscription unlocks the answers to the online exercises, quizzes and puzzles. It also provides the teacher with access to quality external links on each of the Transum Topic pages and the facility to add to the collection themselves.

Subscribers can manage class lists, lesson plans and assessment data in the Class Admin application and have access to reports of the Transum Trophies earned by class members.

Subscribe

## Go Maths

Learning and understanding Mathematics, at every level, requires learner engagement. Mathematics is not a spectator sport. Sometimes traditional teaching fails to actively involve students. One way to address the problem is through the use of interactive activities and this web site provides many of those. The Go Maths page is an alphabetical list of free activities designed for students in Secondary/High school.

## Maths Map

Are you looking for something specific? An exercise to supplement the topic you are studying at school at the moment perhaps. Navigate using our Maths Map to find exercises, puzzles and Maths lesson starters grouped by topic.

## Teachers

If you found this activity useful don't forget to record it in your scheme of work or learning management system. The short URL, ready to be copied and pasted, is as follows:

Alternatively, if you use Google Classroom, all you have to do is click on the green icon below in order to add this activity to one of your classes.

It may be worth remembering that if Transum.org should go offline for whatever reason, there are mirror sites at Transum.com and Transum.info that contain most of the resources that are available here on Transum.org.

When planning to use technology in your lesson always have a plan B!

Do you have any comments? It is always useful to receive feedback and helps make this free resource even more useful for those learning Mathematics anywhere in the world. Click here to enter your comments.

For Students:

For All:

Scan the QR code below to visit the online version of this activity.

https://Transum.org/go/?Num=506

## Description of Levels

Close

Percentages - Before starting the Interest exercise make sure you are confident finding percentages of quantities.

Level 1 - Investments earning simple interest

Level 2 - Investments earning compound interest

Level 3 - Loans accruing compound interest

Level 4 - Appreciation and depreciation

Level 5 - Interest calculated half-yearly, quarterly or monthly

Overdraft Charges - Do you understand how your bank charges you for taking out an overdraft?

Amortisation and Annuities - An exercises containing problems about gradually paying off loans and calculating pension plans.

Exam Style Questions - A collection of problems in the style of GCSE or IB/A-level exam paper questions (worked solutions are available for Transum subscribers).

More on this topic including lesson Starters, visual aids, investigations and self-marking exercises.

Answers to this exercise are available lower down this page when you are logged in to your Transum account. If you don’t yet have a Transum subscription one can be very quickly set up if you are a teacher, tutor or parent.

## Curriculum Reference

See the National Curriculum page for links to related online activities and resources.

## Simple Interest Formulas

$$\text{Interest earned} = P \times \frac{r}{100} \times n$$
$$\text{Final amount} = P + P \times \frac{r}{100} \times n$$

$$P$$ is the principal, the amount originally invested.

$$r$$ is the rate of interest expressed as a percentage.

$$n$$ is the number of years the amount was invested for.

## Compound Interest Formulas

$$\text{Final amount} = P(1 + \frac{r}{100k})^{nk}$$
$$\text{Interest earned} = P(1 + \frac{r}{100})^{n} - P$$

$$P$$ is the principal, the amount originally invested.

$$r$$ is the rate of interest expressed as a percentage.

$$n$$ is the number of years the amount was invested for.

Don't wait until you have finished the exercise before you click on the 'Check' button. Click it often as you work through the questions to see if you are answering them correctly. You can double-click the 'Check' button to make it float at the bottom of your screen.

Answers to this exercise are available lower down this page when you are logged in to your Transum account. If you don’t yet have a Transum subscription one can be very quickly set up if you are a teacher, tutor or parent.

Close