# UTPA STEM/CBI Courses/Business Math/Business Algebra/Financial Models

Course Title: College Algebra
Lecture Topic: Financial Models
Instructor: Abraham Jimenez, Shaghayegh Setayesh, James Hilsenbeck
Institution:University of Texas-Brownsville

## Backwards Design

Course Objectives
* Primary Objectives- By the next class period students will be able to:
** Determine the Future Value of a Lump Sum of Money
** Calculate Effective Rates of Return
** Determine the Present Value of a Lump Sum of Money
** Determine the Rate of Interest or time Required to Double a Lump Sum of Money
* Sub Objectives- The objectives will require that students be able to:
** Compute Simple Interest
** Differentiate between Present Value and Future Value
** Solve Exponential and Logarithmic Equations
** Utilize a Scientific Calculator
* Difficulties- Students may have difficulty:
** Determining Which Formula to use for Various Applications
** Differentiating between Present Value and Future Value
** Understanding the definition of Effective Rate
** Defining the Various Variables in each Formula
* Real-World Contexts- There are many ways that students can use this material in the real-world, such as:
** Investment Banking
** Personal Saving Accounts
** Financial Planning
Model of Knowledge
* Concept Map
** Understanding how to solve exponential equations
** Understanding how to solve logarithmic equations
** Understanding that interest is money paid for the use of money
** Understanding that principal is the total amount borrowed
** Understanding that the rate of interest is the amount charged for the use of the principal for a given period of time
** Understanding that simple interest is the amount of interest charged each compound period
** Understanding that compound interest is the amount of interest charged yearly
** Understanding how each variable within the formulas impacts the outcome
* Content Priorities
** Enduring Understanding
*** Interest rate alone does not determine the best investment outcome
** Important to Do and Know
*** Be able correctly input parameters into a scientific calculator
** Worth Being Familiar with
*** Effective rate is sometimes called yield
Assessment of Learning
* Formative Assessment
** In Class (groups)
*** In class discussion about sample problems
** Homework (individual)
*** View online video lectures
** View online PowerPoint presentation
** View online video solutions to textbook problems
** Work online practice exercises
* Summative Assessment
** In class Labs
** Paper and Pencil Homework
** Online Homework
** Online Quiz

## Legacy Cycle

OBJECTIVE
By the next class period, students will be able to:
* Determine the Future Value of a Lump Sum of Money
* Calculate Effective Rates of Return
* Determine the Present Value of a Lump Sum of Money
* Determine the Rate of Interest or time Required to Double a Lump Sum of Money
The objectives will require that students be able to:
* Compute Simple Interest
* Differentiate between Present Value and Future Value
* Solve Exponential and Logarithmic Equations
* Utilize a Scientific Calculator
THE CHALLENGE
You win the mega millions and must invest your new winnings in of two banks. How will you decide which bank is the best bank to invest your money with?
GENERATE IDEAS
Given an investment scenario explore the impact of the outcome by increasing or decreasing the interest rate
Given an investment scenario explore the impact of the outcome by increasing or decreasing the number of compound periods
MULTIPLE PERSPECTIVES
Given an investment scenario explore the combined impact of variable rates of interest and number of compound periods
RESEARCH & REVISE
In-class lecture
Student will participate in open lab discussions to find future values of different investments.
Work in groups to calculate the future value of an initial investment and then have them compare their results to another group.
Students create an excel file that calculates investment.
View online resources to revise their solutions.
TEST YOUR METTLE
Students will be given test template in which they fill out the information as to why they believe their investment is the most practical. Then be given a similar question to find the solution on an individual basis.
GO PUBLIC
Use the Excel file to calculate future investments.

## Pre-Lesson Quiz

* Solve the log(2x) = 10
* Solve 5=2^x
* Find the simple interest of an investment of $5000 invested at 6.2% for one year.
* Solve I = Prt for r

## Test Your Mettle Quiz

* If you borrow $5000 and after nine months pay off the loan in the amount of $5500 what per annum rate of interest was charged?
* Find the amount that results from $1000 invested at 4% compounded quarterly after a period of two years.
* Find the present value to get $600 after two years at 4% compounded continuously.
* Find the effective rate for 6% compounded monthly.
* Determine the rate that represents the better deal; 9% compounded quarterly or 9.25% compounded annually.