If your class is learning about using mathematical concepts in financial situations, then studying

simple interest is important. Use these activities and games to help your students master calculating
simple interest.

I=PxRxT
If students are signing up for their first savings account or getting a car loan, understanding simple
interest is an important life skill. When students learn to calculate simple interest, it can help them
make wise and informed financial decisions in the future. Let's look at some activities and games to
help students learn about simple interest.

Categorize the Variable

Play this small-group game to help students identify the numeric values for the principal, rate, and
interest located in word problems.

Materials
 Sets of cards with word problems written on them
 Chart paper
 Markers

Teacher Directions
1. Prior to the game, create sets of cards with word problems involving simple interest written
on them. Give each word problem a number.
2. Provide the class with a real-life scenario involving simple interest, such as interest in a
savings account or a consumer loan.
3. Discuss the formula for simple interest and identify the different variables, such as I
(interest), P (principal), R (rate), and T (time).
4. Divide the class into teams, and provide each team with chart paper, markers, and a set of
the word problem cards you made.
5. Each team should divide their chart paper into columns for the variables P, R, and T. Also,
they should create a column for the number of each word problem card.
6. When you say 'go,' the teams read each word problem and categorize the numbers in the
word problems under the correct variable on their chart paper. Students will write the number
written on the word problem card and then write the numbers from the word problem that
correspond to each variable.
7. The first team to correctly categorize the variables from their word problems wins.

Discussion Questions
 Why is it important to identify what numbers represent different variables in a simple interest
problem?
 Were there any problems in which it was difficult to figure out what numbers were the
principal, rate, and time?
Get a Bank Account/Loan
Have students research simple interest savings accounts and car loans as they calculate the interest
that will accrue.

Materials
 Advertisements for savings accounts and auto loans
 Access to online/print resources
 Poster board
 Markers

Teacher Directions
1. Show students examples of advertisements for savings accounts and auto loans advertising
interest rates.
2. Show the class how to figure out the interest that would accumulate if you invested a certain
amount of money in a savings account or spent a specific amount of money on a car.
3. Discuss the difference between interest for a savings account and a loan. For example, with
a savings account you would want a high interest rate to make money, while with a loan you
would want a low interest rate since you are paying the money back.
4. Divide the class into pairs, and provide each pair with poster board and markers.
5. Have the pairs research the simple interest rate for two savings accounts and two auto
loans.
6. Students will figure out the interest accrued over a given amount of time with a given amount
of principal for both savings accounts and both auto loans. Students will then determine
which savings account and car loan would be the best option to select.
7. On the poster, students will display their reasoning for the savings account and car loan they
selected. This should include the calculations to show why the selected account and car loan
are the best decisions.
8. When the pairs are finished, they will share their projects with the class.

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