# Ch 7: Interest & Purchases

Use video lessons to learn about the many factors that connect the concept of interest to the act of purchasing. The short, self-assessment quizzes that accompany each lesson can tell you right away if you're on track with your learning.

## Interest & Purchases - Chapter Summary and Learning Objectives

Almost any type of purchase obtained through credit will involve an element of interest. Various types of math calculations might be required, and this chapter can help you become acquainted with many of them. Learn about common credit terms, installment purchases and promissory notes. Not only can you become familiar with the following topics, but you can also get real-world practice through fun examples while calculating the following:

• Markdown and markup
• Effective annual rate of interest
• Total interest for financing

Video Objective
Index Numbers in Statistics: Uses & Examples Identify index numbers and learn how to interpret them.
Credit Terms: Due Date, Invoice Date and EOM Discuss commonly used credit terms, such as determining due date given terms, invoice date, 2/10 and EOM.
Installment Purchases: Payment & Terms Detail how an installment purchase works, including discussion and examples of commonly used terms.
Deferred Payment vs. Cash Price: Calculation & Interest Compare cash price and deferred payment price. Complete price calculations for purchase and financing options.
Markup & Markdown: Calculation & Examples Demonstrate the methods for calculating markdown and markup through detailed examples of real life situations.
Effective Annual Rate: Formula & Calculations Map out how to calculate effective annual rate with known present and future value/balance amounts. Show method for calculating the effective annual rate of interest given nominal rates.
Percentage Increase and Decrease: Calculation and Examples Describe how to calculate percentage increases and decreases with realistic examples.
What is a Promissory Note? - Definition and Examples Discuss promissory note terms using the example of selling a note to the bank. Understand how to make calculations for selling price, total interest, or effective rate.

8 Lessons in Chapter 7: Interest & Purchases
Test your knowledge with a 30-question chapter practice test
Chapter Practice Exam
Test your knowledge of this chapter with a 30 question practice chapter exam.
Not Taken
Practice Final Exam
Test your knowledge of the entire course with a 50 question practice final exam.
Not Taken

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