Easy way to teach compound interest (from Summer Institute)

Beci invests £3000 for 2 years at an interest rate of 4% p.a.

Write 100%, 10% and 1% for year 1. Do calculation, then write again for year 2.

Students need to appreciate that simple interest is a useful approximation, but wrong.

On calculator:

[Money] x [always 1].[percentage] [to the power of the number of years]

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