Managing money (revision)

Managing money (revision)

Chapter 17

Managing money

• 17.1 Earning money

• 17.2 Borrowing and investing

• 17.3 Buying and selling

17.1 earning money

• People who are formally employed may be paid a salary, wage or earn commission.

• The amount a person earns before deductions is the gross earnings. The amount they actually are paid after deductions is their net earnings.

• Employers may deduct amounts from employees' earnings such as insurance, union dues, medical aid and taxes.

17.2 Borrowing and investing money

• If the amount of interest paid or charged is the same for each year, then it is called simple interest.

• When the interest for one year is added to the investment and the interest for the next year is calculated on the increased investment, it is called compound interest.

17.2 Borrowing and investing money

• The original amount invested or borrowed is called the principal.

• For simple interest, the interest per annum = interest rate x the principal.

17.2 Borrowing and investing money

•  $I=\frac{PRT}{100}$  

•  $V=P\left(1+\frac{r}{100}\right)^n$  

Open Ended

Jamira earns a monthly salary of $5234. (1) What is monthly gross salary? (2) She pays 12% tax and has a further $456.90 deducted from her monthly salary. Calculate her net monthly income.

Open Ended

Find the selling price of an article that was bought for $750 and sold at a profit of 15%.

Open Ended

Sal wants to buy a used scooter. The cash price is $495. To buy on credit, she has to pay a 20% deposit and then 24 monthly installments of $25 each. How much will she save by paying cash?

Open Ended

How much will you have in the bank if you invest $500 for four years at 3% interest, compounded annually?