Summary: CREDIT CARDS AND CARS:
THE MATHEMATICS OF THE AMERICAN DREAM PART I
George Ashline Joanna Ellis-Monaghan
St. Michael's College, VT St. Michael's College, VT
Description: Given an actual credit card statement, students verify the bill. With
materials from a local automobile dealership, students choose between financing and
leasing a new car.
Keywords: Credit cards, car payments, simple interest, finance charges, down payments,
simple interest amortized loans, financial mathematics.
Objectives: To engage students with hands-on experience with some of the calculations
and analysis involved in balancing a credit card statement and choosing whether to
buy or lease a car; to provide motivation for various topics in financial mathematics;
to convince students of the relevance of mathematics in their daily lives.
Prerequisites: Organizational ability, attention to detail, and comfort with algebraic
concepts such as order of operation and properties of exponents.
Course level: Any course, such as algebra II, pre-calculus, financial mathematics, in
which students have or develop an understanding of basic algebraic methods, or any
course that develops basic formulas for simple and compound interest, and amortized
loans. This is a good capstone project for the financial component of such a course.
Technology used: At least a calculator with a memory function and exponentiation key.