ToChargeOrNotToCharge.pdf

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UVA-SCPS Office of Mathematics Outreach with support from VADOE Mathematics and Science Partnership Grant Program NCLB Title II Part B

Revised 11/26/12 1

Mathematics Senior Level Capstone Course Unit Overview

Title of Unit: To Charge or Not to Charge-That is the Question Unit Designers:

Mikhail Balachov (Arlington) Su Chuang (Loudoun) Mirela Geagla (Arlington) Hunter Hagerty (Loudoun) Kiera Poplawski (Loudoun) Debora Strickler (Loudoun) Context:

Summary of the issue, challenge, investigation, or problem.

Students will research the details of various credit cards, create a spreadsheet to calculate payments for each of three credit cards, and determine the best management of credit card debt.

Number of Class Hours:

17 - 20 Unit

Design: ___Task Based _X_Project Based Other Subject

Areas/Disciplines Addressed:

Economics, Personal Finance (possible connection to the Decision Making Matrix with the unit Car Buying).

Driving Question: How much does it really cost when you make a credit card purchase? Mathematics Content

Addressed:

Simple interest, compound interest; exponential functions MPE Addressed:

Problem Solving, Decision Making, and Integration, Understanding and Applying Functions Assumption of Prior

Knowledge:

Interest formula, Computation with rational numbers

College and Career Readiness/21st Century

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Revised 11/26/12 2

Skills to be taught (T) during this unit or expectation (E) for student use during this unit and assessed (A): BIE Page 35-37

Communication (Oral and/or Written) E Technology E, A

Critical Thinking/Decision Making E, A Other: (Describe)

Major Products and/or Performances:

Group- will research different credit cards and choose 3 that they will use for their project. They will create a payment schedule for all three with justification.

Presentation Audience:

X Class

School Individual- Students will evaluate and reflect on their financial

decisions in a journal entry and indicate any changes they would make to their decisions.

Expert Community Other:

Launch: Event or experience used to engage the students interest and inquiry:

A series of video clips introducing credit, credit card use, and establishing credit history.

Credit Education Week Canada 2008:

This video clip is an introduction to the importance of understanding credit, managing money, and managing debt. http://www.youtube.com/watch?v=zo-gL_dNsE8&feature=related

Funny Money, Get it on Credit – Investor Education Fund

This video clip describes some of the possible disadvantages of using a credit card. This video highlights the actual costs of an MP3 player charged on a credit card if the balance was paid in its entirety, paid in minimum payments, and if payments are missed.

http://www.youtube.com/watch?v=83wtyEqD1fc

Build Credit at a Young Age

This video clip discusses the importance of establishing a credit history and how credit cards can be used to help build one’s credit history.

http://www.youtube.com/watch?v=gkpqzyZMg4o

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Revised 11/26/12 3

Evaluation: Formative Assessments (During the Unit)

Interview X Practice Presentations

Mathematicians Journal X Notes

Preliminary

Plans/Outlines/Prototypes

Checklists

Rough Drafts Concept maps

Field Tests Other:

Summative Assessment (End of Project)

Written Products, with a rubric X Peer Evaluation, with a rubric

X

Oral Presentation with a rubric X Self Evaluation, with a rubric

X Other Product(s) or

Performance(s), with a rubric

Other:

Resources Needed: On-site people, facilities: Internet to do research for credit cards Equipment/Technology: Computers

Materials:

Community Resources: Representatives from the Benefits department at a school division, Representatives from a community bank, Financial planners

Reflection Methods: Individual, Group, and/or Whole Class

Mathematicians Journal X Small/Focus Groups Whole Class Discussions Fishbowl Discussions

Survey Other:

Material Adapted From: (Provide credit for any materials or activities adapted from other sources.)

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UVA-SCPS Office of Mathematics Outreach with support from VADOE Mathematics and Science

Partnership Grant Program NCLB Title II Part B Revised 11/26/12 4 Virginia’s Senior Level Capstone Course

Instructional Plan

Unit Title: To Charge or Not to Charge-That is the Question

Driving Question: How much does it really cost? A thorough exploration of credit cards. Task/Project/Problem: Students will research the details of various credit cards, create a

spreadsheet to calculate payments for each of three credit cards, and determine the best management of credit card debt.

ENGAGE How will student’s interested be peaked so they want to engage in the inquiry in this unit? Number of hours 1 to 2

Students most likely would have had some exposure to the concept of borrowing money through television ads, newspaper articles, or hearing conversations from family members. Although there are many options for borrowing money, this unit will focus mainly on credit cards and managing credit card debts.

Direction for Instructor:

 Determine the students’ background knowledge and misconceptions about credit cards by asking students what they know about credit cards. Teachers may want to show a video of a credit card advertisement and have students discuss what they know about the purpose of credit cards, the

advantages of having/using credit cards, and some of the possible disadvantages of credit card use.

 Discussion Question: What do credit card advertisements portray to entice consumers to use their credit card?  Teachers may want to show some or all of the following

videos to engage students in the conversation about credit card debt and credit card use. These videos certainly highlight some of the possible disadvantages of using credit cards, so teachers may want to infuse conversations about the advantages and conveniences of using credit cards.

Credit Education Week Canada 2008: (1:17)

This video clip is an introduction to the importance of understanding credit, managing money, and managing debt. http://www.youtube.com/watch?v=zo-gL_dNsE8&feature=related

Funny Money, Get it on Credit – Investor Education Fund (3:57) This video clip describes some of the possible disadvantages of using a credit card. This video highlights the actual costs of an MP3 player charged on a credit card if the balance was paid in its entirety, paid in minimum payments, and if payments are missed. http://www.youtube.com/watch?v=83wtyEqD1fc

Build Credit at a Young Age (2:28)

This video clip discusses the importance of establishing a credit history and how credit cards can be used to help build one’s credit

Mathematician Journal Prompts 1. Do you plan on having a credit card? Why? 2. Why is

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Partnership Grant Program NCLB Title II Part B Revised 11/26/12 5 history.

http://www.youtube.com/watch?v=gkpqzyZMg4o Classroom Discussion Questions:

 What are some of the misconceptions about credit card use? Was any of the information presented in the videos a surprise? How does the information presented in the video similar or different to information presented in credit card

commercials/advertisements?

 Mathematicians’ Journal Prompt: Teachers may want to have students explore how credit might be applicable in their own lives or their near futures (i.e. after high school). Some students may already have experience with credit cards or may be aware of family experience with credit cards and debt. Please be cautious that discussions about credit card use and debt may illicit negative responses from students who may be aware of any family difficulties with finances.

Anticipated products or artifacts: Mathematicians’ Journal entries

EXPLORE Teacher provides

guidance for the explorations to prepare students with the

knowledge and skills to engage in the task. Students will self-assess on the prior knowledge and skills assumed for the unit

Number of hours 7 to 8

Exploration #1

Title: Financial Literacy Jigsaw Goal of the activity:

The purpose of the Financial Literacy Jigsaw is to have students familiarize themselves with various financial literacy terms and vocabulary they may encounter as they explore credit card use. Although there are many additional financial literacy terms, the focus for this unit is on credit card use.

Description of the Activity: HO #1: Financial Literacy Jigsaw

In this activity students, in groups, will define a group of financial literacy terms and vocabulary. Students create electronic

presentations to share the definitions for their financial literacy vocabulary.

Materials Needed:

Computers with Internet access

Materials to create presentation (i.e. poster paper, markers, etc…if teachers choose not to create an electronic presentation)

Directions for Instructors:

 Teachers should choose one format for the class to share the jigsaw definitions and explanations of financial literacy terms.

Mathematician Journal Prompts 1. What are

factors that would influence your decision when choosing a credit card? 2. What do you

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Partnership Grant Program NCLB Title II Part B Revised 11/26/12 6 Upon completion of this activity, the class will have a

collection of terms in a type of glossary to refer to throughout the unit. This format could be a PowerPoint Slideshow, an electronic portfolio, a document, or posters to display around the classroom.

 Teachers can engage students in a variety of activities to familiarize students with the financial literacy terms. A jigsaw activity is one way for students to create definitions and explanations for the terms.

 Students will probably run into each other’s vocabulary words as they define their assigned words. As students present their piece of the jigsaw, teachers may want to have students revisit some terms and edit definitions. At the end of the activity, the class should have a complete glossary to refer to on the financial literacy terms for the unit.

 Although the goal is not for students to simply memorize vocabulary terms, students need to be fluent with the

vocabulary, understand the concepts, and be comfortable using the financial literacy vocabulary. An optional activity is for students to develop their own informational video defining or explaining some of the key financial literacy vocabulary. Exploration #2

Title: Plastic Money Goal of the Activity:

The purpose of this activity is for students to conduct

computations, familiarize themselves with some of the financial literacy terms, and practice or learn to create a spreadsheet with formulas if teachers choose.

Description of the Activity: HO#2: Plastic Money

Students are given specific information regarding a credit card and the balance on that credit card. In groups of two, students

calculate the interest and remaining balance when paying the minimum payment only.

Materials Needed:

Computers if students are creating electronic spreadsheets (i.e. MS Excel)

Calculators if students are creating spreadsheets on the calculator or creating tables on paper

Directions for Teachers:

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Partnership Grant Program NCLB Title II Part B Revised 11/26/12 7 how the ‘Interest’, the ‘Amount applied to Principal’, and the

‘Current Balance’ are calculated.

 This is the appropriate time to support students who need additional instruction or practice using the tools necessary for this activity (i.e. practice with creating spreadsheets on calculators, practice creating an MS Excel spreadsheet, or practice with the computation).

Exploration #3 Title: Pay It Off Goal of the Activity:

The purpose of this activity is for the entire class to research the details about credit cards and create a spreadsheet or calculation table for credit card debt.

Description of the Activity:

HO #3: Credit Card Selection Worksheet

The entire class researches at least three credit cards and collects various details about the credit cards. The entire class “shops” and selects several items to “purchase” in order to accrue credit card debt. In groups, students select one of the three credit cards to “charge” these items to and create a spreadsheet or calculation table to pay off the debt.

Materials Needed:

Tools to create spreadsheet or calculation table Several credit card applications

Advertisements or price lists of items to “purchase”

Directions for Teachers:

 Review HO#3: Credit Card Selection Worksheet with students and review or explain concepts that students are unfamiliar with.

 In groups, students will review a credit card application and fill in the information on the credit card selection worksheet. Have a minimum of three credit cards to review.

 Have a copy of the credit card selection worksheet to fill in for the whole class discussion.

 As a whole class activity, complete the credit card selection worksheet for the three credit cards.

 As a class, review several advertisements and instruct students to “purchase” several items to accrue a credit card debt of at least $3,000. The entire class should purchase the same items at the same cost. This will allow students to compare the different credit cards for the same purchases.

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Partnership Grant Program NCLB Title II Part B Revised 11/26/12 8 Be sure there is at least one group for each of the three credit

cards.

 The entire class is making the same monthly payment to pay off this debt. The entire class is assuming that no additional purchases or debt is added to the credit card.

 The monthly payment is exactly $200.

 Students will create a spreadsheet or calculation tool to calculate how long it will take to pay off the debt, how much interest is paid, what is the total cost of the items “purchased” once interest is included into the total cost.

 Students will explore how these factors changed if the monthly payment was increased to $400 or some other amount.

 Students will present their spreadsheets or calculation tools to the entire class.

 The entire class will analyze and discuss the advantages and disadvantages to each of the credit cards and explore other options (i.e. balance transfer, selecting different credit cards, etc…)

EXPLAIN Teacher introduces the main task of the unit and prepares students to in small group independent work...

Number of Hours 0.25

HO #4: Manage Your Credit

Introduce the main project, where students research credit cards and select three cards to use in their project. Explain that students will have a total of $300 to put toward monthly payments on all three cards, and that there will be a continuing balance on each card.

Direction for Teachers:

If students struggle with the open-endedness of this activity, consider HO #5: Manage Your Credit, which is the same activity with additional structures in place to assist students.

Mathematician Journal Prompts ELABORATE The student groups are working independently with teacher consultations. Number of Hours 4 to 5

Students research and select three credit cards to use. They are told they have a balance on each card and have a total of $300 for the monthly payments on all three cards.

Students are to determine how to distribute the money between the three credit cards, create an Excel spreadsheet or calculation table to illustrate their payment schedule. They must also write a paper to justify their choices of cards.

The teacher monitors student progress as groups begin in groups to research and identify the credit cards to use.

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Partnership Grant Program NCLB Title II Part B Revised 11/26/12 9 Details of this task are provided on HO #4: Manage Your Credit.

If students are struggling with the open-endedness of this task and need more structure to the task, the teacher can assign HO #5: Manage Your Credit, for a more structured task.

Students write a position paper to justify their financial decisions and present their analysis of their spreadsheet or calculation table to support their decision.

EVALUATE Working groups submit products or make

presentations Number of Hours 4

Student groups present their projects and justify their financial decisions to the class. The focus of this presentation is on each group’s justification for selecting specific credit cards, their analysis of the calculation table/spreadsheet, and how the analysis informed their financial decisions to pay off their debt.

Upon completion of the presentations, students are asked to reflect on their group’s financial decisions individually in a

Mathematician’s Journal entry. Students should consider any changes they may make in their payment plan or their selection of credit cards.

Mathematician Journal Prompts 1. Now that

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Partnership Grant Program NCLB Title II Part B Revised 11/26/12 10 Map the Unit

What do students need to know and be able to do to complete the task/project/problem

successfully? How and when will they assess their own necessary knowledge and skills? How will they remediate their own gaps or weaknesses in knowledge and skills? Look at each major task for the unit and analyze the tasks necessary to produce a high-quality product.

Task:

KNOWLEDGE AND SKILLS NEEDED Assumed already learned

Students will self-assess

Will be taught during the unit

1. Simple Interest X X

2. Compound Interest X X

3. Spreadsheets/Calculation Tables X X

4. Percents X X

5. 6. 7. 8. 9. 10. 11.

What project tools will student’s use?  Know/need to know lists  Daily goal sheet

 Mathematician’s Journals  Briefs/Memos

 Task lists

 Planning Calendar

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Partnership Grant Program NCLB Title II Part B Revised 11/26/12 11 HO #1

Financial Literacy Jigsaw Activity

 Divide the class into groups of 3 or 4. Class size will determine how many terms each group receives.

 Each group will research their assigned terms and create a definition/explanation for each term.  Then each person in a group will be grouped with one person from each of the other groups to present

the definitions and explanations of their terms.

 The initial groups will come back together to edit their definitions and include their work in a class glossary of Financial Literacy Vocabulary.

Principal

Interest

Interest Rate

Credit Score

Credit History

Financing

Gross Income

Net Income

Expenses

Credit Line

Creditor

Collection

Debt

Pre-approved

Lender

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Partnership Grant Program NCLB Title II Part B Revised 11/26/12 12

HO#2

Plastic Money

You have credit card charges totaling $ 15,750. The interest rate of your card is 10.5% APR or

Annual Percentage Rate. The credit card company tells you your minimum payment should be

$ 135. The amount of interest due is calculated with the formula:

Current Balance

   

  

1200

YearlyAPR

.

( Here the APR is NOT changed to a decimal). The remaining amount is applied to lowering the

principal/current balance.

1. Make a table that shows the months, the interest paid, and the current balance. You may use a

calculator or a spreadsheet in Excel.

Month

Current Balance

Interest

Amt applied to Principal

1 $15,750.00

$137.81

-$2.81

2 $15,752.81

$137.84

-$2.84

3 $15,755.65

4

5

6

7

…

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3. If so, how long will it take to be debt free?

4. Make a new table with a minimum payment of $150, then repeat the process using a

minimum payment of $180.

Month

Current Balance

Interest

Amt applied to Principal

1 $15,750.00

$137.81

2

3

4

5

6

7

…

4. What is the amount of interest you would have paid over the time of the loan if your

minimum payment is $150?

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Revised 11/26/12 14

HO #3

Credit Card Selection Worksheet

Members of group:

Date ____________

_

Credit card name

Introductory APR and duration

(# of months intro rate is used)

APR for balance transfers

APR for cash advance

APR for new purchases

Penalty APR

Minimum finance charge

Grace Period (days)

Late payment fee

Over the limit fee

Cash advance fee

Cash advance limit

Credit limit

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HO#4

Managing Your Credit

You have finally reached the point in your life when you can apply for a credit card.

Assuming you are pre-approved for any three major credit cards, which ones would you

pick?

Credit Card #1: _________________________________________________________

Credit Card #2: _________________________________________________________

Credit Card #3: _________________________________________________________

After careful consideration and weighing in benefits and calculating disadvantages, you

are starting to use your credits cards. Soon enough you will have quite a hefty balance!

Your current situation is as follows:



Credit card #1 has a balance of $3,000.00



Credit card #2 has a balance of $2,500.00



Credit card #3 has a balance of $2,000.00



You have a total of $ 300 per month to distribute amongst all three credit card

debts.

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HO#5

Managing Your Credit

You have finally reached the point in your life when you can apply for a credit card. You

have been pre-approved for the following three major credit cards.

Credit Card #1: 16% APR

Credit Card #2: 18% APR

Credit Card #3: 22% APR

After careful consideration and weighing in benefits and calculating disadvantages, you

are starting to use your credits cards. Soon enough you will have quite a hefty balance!

Your current situation is as follows:



Credit card #1 has a balance of $3,000.00



Credit card #2 has a balance of $2,500.00



Credit card #3 has a balance of $2,000.00



You have a total of $ 300 per month to distribute amongst all three credit card

debts. Suppose you allocate $150.00, $80.00, and $70.00 respectively to the 3

credit card bills.

Create an Excel spreadsheet or complete the calculation tables below to illustrate your

monthly payments until you have a zero balance on each credit card.

Exploration:

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Credit card #1:

16 % APR and has a balance of $3,000.00, monthly payment of $150.00

Balance

Monthly

Payment

Interest

Principal Amount

Paid

New Balance

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Credit card # 2:

18% APR and has a balance of $2,500.00, monthly payment of $80.00

Balance

Monthly

Payment

Interest

Principal Amount

Paid

New Balance

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Credit card # 3:

22% APR and has a balance of $2,000.00, monthly payment of $70.00

Balance

Monthly

Payment

Interest

Principal Amount

Paid

New Balance

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Revised 11/26/12 20

Scoring Rubic

5 4 3 2 1

1. Student researches credit cards and creates a data base. Fills out selection sheet with all pertinent information and selects which 3 they will use

1. Student researches credit cards and fills out selection sheet just for the 3 they are using with correct information

1. Student fills out selection sheet for 3 cards

1. Student selects 3 cards but with missing information for selection sheet

1. Student selects 1 or 2 cards with partial information for selection sheet

2. Student sets up a

payment/amortization table in Excel with correct formulas and data for each card

2. Student sets up a

payment/amortization table in Excel with correct

formulas and data for 2 cards

2. Student sets up a payment/amortization table in Excel with incorrect formulas and data for each card

2. Student sets up a payment/amortization table in Excel with incorrect formulas and data for 2 cards

2. Student sets up a payment/amortization table in Excel with incorrect/correct formulas and data for 1 card

3. Student shows in Excel the fastest way to pay off all 3 cards and prints off table

3. Student shows in Excel a way to pay off all 3 cards and prints off table

3. Student shows in Excel the fastest way to pay off 1 of the cards and prints off table

3. Student shows in Excel ways to pay off all 3 cards and prints off table

3. Student shows how to pay off one card in Excel

4. Student produces a paper that summarizes and justifies their processes and graphically shows correct information in tables and forms. Uses correct grammar.

4. Student produces a paper that summarizes their processes and graphically shows correct information in tables and forms. Uses correct grammar.

4. Student produces a paper that

summarizes their processes and graphically shows correct information in tables and forms. Contains incorrect grammar.

4. Student produces a paper that summarizes their processes. Contains incorrect grammar.

4. Student has

ToChargeOrNotToCharge.pdf

Principal

Interest

Interest Rate

Credit Score

Credit History

Financing

Gross Income

Net Income

Expenses

Credit Line

Creditor

Collection

Debt

Pre-approved

Lender

HO#2

Plastic Money

You have credit card charges totaling $ 15,750. The interest rate of your card is 10.5% APR or

Annual Percentage Rate. The credit card company tells you your minimum payment should be

$ 135. The amount of interest due is calculated with the formula:

Current Balance

.

( Here the APR is NOT changed to a decimal). The remaining amount is applied to lowering the

principal/current balance.

1. Make a table that shows the months, the interest paid, and the current balance. You may use a

calculator or a spreadsheet in Excel.

Month

Current Balance

Interest

Amt applied to Principal

1

$15,750.00

$137.81

-$2.81

2

$15,752.81

$137.84

-$2.84

3

$15,755.65

4

5

6

7

…

3.

If so, how long will it take to be debt free?

4. Make a new table with a minimum payment of $150, then repeat the process using a

minimum payment of $180.

Month

Current Balance

Interest

Amt applied to Principal

1

$15,750.00

$137.81

2

3

4

5

6

7

…

4.

What is the amount of interest you would have paid over the time of the loan if your

minimum payment is $150?

HO #3

Credit Card Selection Worksheet

Members of group: ____________________________ ____________________________

Date ____________

_____________________________ ____________________________

Credit card name

Introductory APR and duration

(# of months intro rate is used)

APR for balance transfers

APR for cash advance

APR for new purchases

Penalty APR

Minimum finance charge

Members of group:

_