Independence Day

by

Joe Marusa

Conclusion

            In this exercise, you worked as a team to spend $7000 on items for use in the home.  You depended on each other to do his or her part.  You pooled resources together to buy items you needed for each other on a budget.  You compared prices on items you need by shopping around at different stores to make informed decisions.  Also, you shopped around for a credit card and tried to find the best APR.  In addition, you calculated the interest that would accumulate on your credit card balance over a period of six months.  You came up with reasons to justify your purchases and presented them to the class.  You also made use of visual aids, a word processor, and the Internet to assist you in this project.  Above all, you decided everything as a team.

            You assumed a daily compounded interest rate for your credit card.  But what if it was compounded monthly?  Use the interest formula in the procedure to calculate how much you would owe if the interest were compounded monthly instead of daily.  How much would you owe?  Repeat for if the interest is compounded hourly.  Which is most profitable for the consumer?  What about for the credit card company?