Teacher Script & Notes
What to say / Spoken Script
When a value increases, we add the percentage increase to 100%. For example, a 20% increase on $100 means the new price is 120% of the original, which is $120. Let's look at the bar chart comparing the two prices.
What to do / Action Guide
Show a comparison bar chart representing a price jump from $100 to $120.
Pedagogical Tips
Point out that percentage change is always calculated relative to the *original* value.
What to say / Spoken Script
Unlike simple interest, compound interest calculates interest on the previous interest. This leads to exponential growth over time. Each year, we multiply the new balance by the growth factor.
What to do / Action Guide
Display the curve showing simple vs compound interest growth over 5 years.
Pedagogical Tips
Highlight the widening gap between the linear growth and exponential growth curves.
What to say / Spoken Script
Let's look at a concrete example of a bank savings account to see how interest payments work in practice. Suppose you deposit $1,000 into a savings account that pays 10% annual compound interest. At the end of Year 1, the bank pays you 10% of $1,000, which is $100. Your new balance is $1,100. In Year 2, the bank calculates 10% of your new balance ($1,100), which is $110. Your balance becomes $1,210. Notice that your interest payment grew from $100 to $110 because you earned interest on the first year's interest! By Year 3, your balance reaches $1,331.
What to do / Action Guide
Highlight the growing yearly balances and the increasing annual interest payments in the bar graph.
Pedagogical Tips
Explain to students that compound interest is why saving money early is so powerful: the longer the money sits in the account, the faster the interest payments grow.
Step 1: Introduction
Step 1 of 3
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