Math+Lesson+1

Page for Penny and Ernie's lesson.

Penny thanks for creating separate pages!

You sparked an idea when you asked if there was something that I teach - it is how to calculate finance charges on an average daily balance, which is the most common balance method used for credit cards. __Example:__ Bob has a $5,000 average daily balance and his statement covers 30 days. His Annual Percentage Rate (APR) for the entire balance is 14.99%. What is the dollar amount of finance charges that will bill on his statement? __Formula:__ APR/100 = APR in decimal format (decimal rate) Decimal Rate/365 = Daily Periodic Rate (DPR) DPR * Balance * # of days in billing cycle (statement) = $ amount of finance charges __Solution to example:__ 14.99/100 = .1499 .1499/365 = 4.106849315068493e-4 (as displayed on the calculator). Decimal format is .0004106849315068493 .0004106849315068493 * 5000 * 30 = $61.60 Answer: An average daily balance of $5,000 with a 14.99% APR and 30 days in the statement will lead to $61.60 in finance charges.

What do you think? Too complicated of a topic? We can tackle how to calculate the average daily balance too if you would like. Maybe how to use a spreadsheet to perform the calculations? I'm open to feedback/input. EMG093009

Ernie - That looks like a great idea. Is the objective to get them to understand the concept of how the formula works or to develop a method to be able to calculate the charges? I would assume that the bank programs do the calculations automatically, so what it is they need to be able to do? PN093009 Penny - good clarifying questions! You are correct that systems perform these calculations automatically, however, it is critical that students understand how the calculation works and if asked/prompted can calculate the charges manually. This is important for several reasons - first and foremost, if a customer asks "How did you come up with $61.60 in finance charges?" the student must be able to clearly explain how the calculation works, up to and including walking the customer through the calculation step-by-step if necessary. Second, if the customer claims there has been an error the student must be able to quickly and effectively check to ensure that the charges are accurate.

Thus students need to understand how to perform the calculations and utilize excel to help them "manually" calculate the charges. However, all consumers who have (or will have) a credit card should understand how the calculation works. This ensures they can calculate the costs of credit on their own ahead of time and they can double check charges on their own statements for accuracy. What if we took that route for our lesson - teaching students to be savvy and knowledgeable consumers? For example, what if our lesson presented the students with two different "account" examples with finance charges on their statements and we direct the students to utilize excel to check and see if the charges are indeed correct? One of the examples could be accurate and the other could be an "overcharge". This would allow students to create the formulas in excel and plug in their answer against the scenario answer to see if there is a discrepancy and, if so, how much. Thoughts? EMG100409


 * ) PN100509

So now we really do have to start thinking more about this. You have a very detailed example and lesson idea. I must admit I am having a time determining SMAR. In this lesson the technolgy will be using a spreadsheet to calculate formulas. Now, there must also be calculators online. So the benefit for the students would be in creating the spreadsheet calculator themselves. ? And they would have had enough experience, I assume, in spreadsheets, so that the focus would indeed be on understanding the formula and making it work on the spreadsheet. That works for me. Where is it on the SMAR scale? PN100609

I see your point - as it stands right now we're probably only at Substitution with some Modification and Augmentation. You are correct in that the benefit of the lesson is for students to not only build a working calculator from a financial formula but in so doing to understand the application of the formula. Although the students could attempt to use online calculators how do they know that the caculators are accurate? The only way to do so is to do the math - however, once you've built the calculator and understand how the calculation works you can then use the calculator over and over again for the activity. Make sense?

I've added a group component to the activity as well as a peer review process, both of which utilize a wiki - this should help get us to Redefinition. I tried to access Google Docs again today but can't seem to view your calculator or upload documents, so instead I've uploaded a draft copy of the lesson template here in Wikispaces: [] I've left the Maine Learning Results and National Education Standards portion of the template blank for now - do you have thoughts on those? Do you want to keep them and fill them in or, since the template is ours to modify, do you want to change them to "Concepts" and "Content"? EMG100809

I am working on the rest of the template. I should be done later today (Saturday). Since the students are actually out of school, I will apply the secondary Maine Learning Results along with NETS for students. I'll look at the google docs to see what happened and re-invite you to the document. However, we need an excel example since it will have better features, I think. I couldn't find the format to round to 2 decimals. Do we need a rubric or some form of assessment? I have made a few typo corrections to the lesson plan. Off to work again. PN101009 Here is a link to the google doc. See how this works. It supposedly will republish when any changes are made. @http://spreadsheets.google.com/pub?key=tfMMM9eGgGhU7o2xlyw74eA&output=html Unfortunately it doesn't work as a calculator, but we can see what is there and post it in lesson as the example.

Here is the lesson plan with my additions. I did a little with the formatting of the spreadsheet, hoping that when anyone opens it, it will open with the rows already adjusted. Let me know if it worked. In the section with the activities, I had to divide that into 2 rows, as I'm assuming the row height was at maximum so the Example would not show.

Penny it looks good! I'll publish to PDF and post on the main page. Thanks so much teammate! :) EMG

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