G E N E R A L M AT H E M AT I C S

SIMPLE & COMPOUND

IN
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Lesson 23: Illustrating Simple and Compound Interest

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 Content Standards

The learner demonstrates understanding of key concepts of

simple and compound interests, and simple and general
annuities.

Performance Standards
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The learner is able to investigate, analyze and solve problems
involving simple and compound interests and simple and general
annuities using appropriate business and financial instruments. .

Lesson 23: Illustrating Simple and Compound Interest

G E N M AT H
 Learning Competency

At the end of the lesson, the learner is able to the learner is able to
illustrate and distinguish between simple and compound interest.
(M11GM-IIa-1 and a-2).

Lesson Outline
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1. Simple Interest
2. Compound Interest

Lesson 23: Illustrating Simple and Compound Interest

G E N M AT H
 "What are some ways to take care of
hard-earned money?"
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Lesson 23: Illustrating Simple and Compound Interest

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 LENDER OR CREDITOR

a person (or institution) who invests the money or makes the

funds available

BORROWER OR DEBTOR
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A person (or institution) who owes the money or avails of the
funds from the lender

Lesson 23: Illustrating Simple and Compound Interest

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 ORIGIN OR LOAN DATE

date on which money is received by the borrower

REPAYMENT DATE OR MATURITY DATE

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date on which the money borrowed or loan is to be completely
repaid

Lesson 23: Illustrating Simple and Compound Interest

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 TIME OR TERM (𝒕)

amount of time in years the money is borrowed or invested;

length of time between the origin and maturity dates

PRINCIPAL (𝑷)
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amount of money borrowed or invested on the origin date

Lesson 23: Illustrating Simple and Compound Interest

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 RATE (𝒓)

annual rate, usually in percent, charged by the lender, or rate of

increase of the investment

INTEREST (𝑰)
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amount paid or earned for the use of money

Lesson 23: Illustrating Simple and Compound Interest

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 SIMPLE INTEREST (𝑰𝒔 )

interest that is computed on the principal and then added to it

COMPOUND INTEREST (𝑰𝒄 )

interest is computed on the principal and also on the accumulated

past interests
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MATURITY VALUE OR FUTURE VALUE (𝑭)

amount after 𝒕 years; that the lender receives from the borrower
on the maturity date

Lesson 23: Illustrating Simple and Compound Interest

G E N M AT H
 SIMPLE INTEREST (𝑰𝒔 ) vs COMPOUND INTEREST (𝑰𝒄 )

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Lesson 23: Illustrating Simple and Compound Interest

G E N M AT H
 Based on the illustration shown in the video, distinguish simple interest from

compound interest

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Lesson 23: Illustrating Simple and Compound Interest

G E N M AT H
 HOMEWORK

Generalize the procedures in finding simple and compound interests. You

can express these generalizations using formulas.

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Lesson 23: Illustrating Simple and Compound Interest

G E N M AT H