Calculation should include

• using the simple interest formula (interest = principal x rate x time)
• using spreadsheets, calculators, and/or online tools explaining how the amount of the principal, the term/length of the loan, and the interest rate affect the amount of interest charged.

Process/Skill Questions:

• What is the principal of a loan?
• Why is the term of the loan important?
• What is the interest rate of a loan, and how does this affect the amount of money that must be repaid to the lender?