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Glossary
To Spend or To Save... That Is a Good Question!
A Look at Paying and Receiving Interest

Life Questions

Take a moment and consider the following…

 
Leave $600 in the bank for one year to earn 3% interest and buy a $500 car using a one-year loan at 4% interest, or…
leave $100 in the bank today to earn 3% interest for one year and buy a car today for $500 cash (no interest)?

In this section, we're going to learn about interest, something that is viewed quite differently, depending on whether you are on the receiving end or the paying end. By the end of the lesson, you'll see if, based on what you learn about interest, your answer to our life question remains the same.

After completing this section of the course, you should be able to:

  • recognize the definition of interest
  • determine the best decision to make in regard to interest, if your goal is to keep the most amount of money possible in a given situation

Before moving on, let's watch the following video on interest. When the video is over, proceed to the next page.

Interest