Activity Overview
A home loan is one of the biggest financial commitments any one of us is likely to make, so it makes perfect sense to understand how they work. This activity has students generating their own home loan simulator using the lists and formulas on the TI-30X Plus MathPrint calculator. After generating a 12 month simulation, students use formulas to generate tables of values to help understand how repayments and changing repayments can affect interest and save money.
Objectives
Calculate and compare loan costs when interest is paid or charged daily, monthly, quarterly or six-monthly on a reducing balance loan.
Vocabulary
- Compounding
- Reducing balance
- Interest
- Per annum
- Repayment
About the Lesson
Students use the lists on the calculator to create a semi-automated home loan calculator. The step by step process and questions explore how the proportion of each loan repayment changes over the course of the loan. Students also use a formula to compute the monthly balance and generate a table of values.