Chapter 7.

6 Applications of percentages
Objectives: 1.) Review how to calculate the percentage of a whole 2.) Understand how percentages apply to interest 3.) Understand how percentages apply to tipping etiquette
7/25/12 4.) Understand how percentages apply

Method 1:

To calculate a percentage of a whole…. What is 30% of $1,200?

- Convert percent to a decimal and multiply 30% of $1,200 ===> Method 2: - Set up a proportion
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Ap #1: BAD Interest

LOAN: borrowed lump of money Interest on a LOAN: The CHARGE for borrowing money from bank/lender

Investopedia
7/25/12 http://www.investopedia.com/terms/i/interest.asp

Just a fact

At Iowa State Bank in Sac City, the rates on CD’s and savings accounts: “the best rates we have are 1.25% on savings and 2.5 on a CD I do believe!! Loans range from 4.25-9% mostly but we have some that can go 18% on our not so good customers.”
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Example: BAD Interest

Derric takes out a $2,000 loan from Iowa State Bank. They charge a 9% annual interest rate. a.) What is the interest?

b.) How much total does Derric owe the bank?
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Example: BAD Interest

Derric takes out a $2,000 loan from Iowa State Bank. They charge a 9% annual interest rate. At the end of one year, how much does Derric owe the bank?

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Ap #2: GOOD Interest

Savings Account: A bank arrangement where a person sets aside money; they in a way lend money to a bank. The person collects interest from the bank.

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Bad Interest vs. Good interest

Year(s) Later….

Year(s) Later….

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Example: Good interest

Cody INVESTS his money in a savings account. He puts $5,500 in the bank which offers him a 2% interest rate.

a.) How much money will he earn in interest? b.) How much total will he receive back at the end of the year? 7/25/12

Ap #3: Tipping Etiquette
- Tip your waiter/waitress 15% -20% of your untaxed bill

According to an etiquette advise website
7/25/12 http://www.etiquettescholar.com/dining_etiquette/tipping_

Example: Tipping
Alex and her family receives wonderful service. Her bill not including tax is $24.85. She will tip her server __________%. a.) How much will she be adding as a tip? b.) How much will her total bill be?

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Ap #4 Taxes

Tax: A contribution for the support of a government required of persons, groups, or businesses Purchased goods: 7% Income: 18%-40%

• •

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Example: Taxes

If this person had a wage of $83,744.23, but there was $21,085.32 withheld for taxes, what percent of the earnings is going to taxes?
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James makes a monthly wage of $450. He pays 18% in taxes.

a.) How much money will be withheld? b.) What is his paycheck?
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