Credit & Debt Basics

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Credit & Debt Basics · Grade 10 · Worksheet 3

1. Kaia has 23 baseball cards. Kaia gives away 6 cards to a friend. How many baseball cards does Kaia have left? Answer: 17 Solution: Kaia starts with 23 baseball cards. Subtract the cards given away: 23 - 6 = 17.
   Full step-by-step solution

   Step 1: Kaia starts with 23 baseball cards. Step 2: Subtract the cards given away: 23 - 6 = 17. The answer is 17 cards.

2. Eva has saved $31 from doing chores. Then Eva earns $19 more by helping a neighbor. How much money does Eva have in total? Answer: 50 Solution: Start with the money saved from chores: $31. Add the money earned from helping: $19. Total money: $31 + $19 = $50.
   Full step-by-step solution

   Step 1: Start with the money saved from chores: $31. Step 2: Add the money earned from helping: $19. Step 3: Total money: $31 + $19 = $50. The answer is $50.

3. Oliver has 98 baseball cards. Oliver gives away 26 cards to a friend. How many baseball cards does Oliver have left? Answer: 72 Solution: Oliver starts with 98 baseball cards. Subtract the cards given away: 98 - 26 = 72.
   Full step-by-step solution

   Step 1: Oliver starts with 98 baseball cards. Step 2: Subtract the cards given away: 98 - 26 = 72. The answer is 72 cards.

4. Isabella is considering two student loan options for her college education. Option A offers a 9% annual interest rate compounded monthly for 8 years. Option B offers an 11% annual interest rate compounded quarterly for 6 years. If she borrows $18,000, which option will result in less total interest paid? Answer: A. Option A Solution: To compare loan options, you need to understand how compound interest works. The total interest paid is the difference between the final amount and the original principal.
   Full step-by-step solution

   To compare loan options, you need to understand how compound interest works. The total interest paid is the difference between the final amount and the original principal. Loans with more frequent compounding (like monthly vs quarterly) will accumulate interest differently, even with similar annual rates. Also, the length of the loan term significantly impacts the total interest, as interest has more time to compound. When evaluating financial options, it's important to calculate the total cost, not just look at the interest rate.

5. Matiu has a debt of $35 on a library fine. Matiu also gets a new fine of $36 for a lost book. What is Matiu's total debt now? Answer: 71 Solution: Start with the existing debt: $35. Add the new fine: $36. Total debt: $35 + $36 = $71.
   Full step-by-step solution

   Step 1: Start with the existing debt: $35. Step 2: Add the new fine: $36. Step 3: Total debt: $35 + $36 = $71. The answer is $71 dollars.

6. Jordan has a debt of $9 on a library fine. Jordan also gets a new fine of $49 for a lost book. What is Jordan's total debt now? Answer: 58 Solution: Start with the existing debt: $9. Add the new fine: $49. Total debt: $9 + $49 = $58.
   Full step-by-step solution

   Step 1: Start with the existing debt: $9. Step 2: Add the new fine: $49. Step 3: Total debt: $9 + $49 = $58. The answer is $58 dollars.

7. Aroha has a credit card with a 15% annual interest rate. She carries a balance of $1,200 for one month without making any payments. How much interest will she be charged for that month? Answer: 15 Solution: The annual interest rate is 15%, which means 15% per year. To find the monthly interest rate, divide the annual rate by 12: 15% / 12 = 1.25% per month. Convert the percentage to a decimal for calculation: 1.25% = 0.0125.
   Full step-by-step solution

   Step 1: The annual interest rate is 15%, which means 15% per year. Step 2: To find the monthly interest rate, divide the annual rate by 12: 15% / 12 = 1.25% per month. Step 3: Convert the percentage to a decimal for calculation: 1.25% = 0.0125. Step 4: Multiply the balance by the monthly interest rate: $1,200 × 0.0125 = $15. Step 5: The interest charged for one month is $15.

8. Mason is comparing two student loan options for his college education. Option A has a 7% annual interest rate compounded annually, while Option B has a 12% annual interest rate compounded annually. If Mason borrows $2,000 for one year, how much more interest will he pay with Option B compared to Option A? Answer: 100 Solution: Principal = $2,000 Interest rate = 7% = 0.07 Amount = Principal × (1 + rate) = 2000 × (1 + 0.07) = 2000 × 1.07 = $2,140 Interest paid = 2140 - 2000 = $140 Principal = $2,000 Interest rate = 12% = 0.12 Amount = Principal × (1 + rate) = 2000 × (1 + 0.12) = 2000 × 1.12 = $2,240 Interest paid = 2240…
   Full step-by-step solution

   Step 1: Calculate the amount owed with Option A Principal = $2,000 Interest rate = 7% = 0.07 Amount = Principal × (1 + rate) = 2000 × (1 + 0.07) = 2000 × 1.07 = $2,140 Interest paid = 2140 - 2000 = $140 Step 2: Calculate the amount owed with Option B Principal = $2,000 Interest rate = 12% = 0.12 Amount = Principal × (1 + rate) = 2000 × (1 + 0.12) = 2000 × 1.12 = $2,240 Interest paid = 2240 - 2000 = $240 Step 3: Find the difference in interest Difference = 240 - 140 = $100 Mason will pay $100 more interest with Option B compared to Option A.