Introduction
Financial capabilities are crucial in a world that is becoming more and more financially dependent. It is because of this that it is imperative you become equipped with skills to allow you to navigate the world of personal finance. In this activity you will interact with car finance, a major part of the finance that all of you will have to encounter in the coming years.
Task
As a personal accountant a family has hired you to ensure that the best financial choices are made. The family is looking for a new car and have multiple parameters that they want to make sure are met.
Your task is to select an appropriate vehicle for the family's recreational and financial needs, as outlined below.
The Smith's are a young family of 5 (2 adults, 3 children), on weekends they enjoy trekking up beaches or camping off road. The family is happy to have a second hand car but have said that it must have less than 50,000km. Their combined income has allowed for the cars value to be $40,000 however they are looking at placing this on personal car loan and want to know what their best options are. Regardless of what type of loan they wish to have it paid off within 5 years.
With your expertise in finance you are to examine a variety of loans (simple interest and compounding interest with varying payment periods) to determine what the best option is for the Smith family.
You will present the final payment plan to the family by the end of the week.
Process
You have 1 week (3 x 70 min lessons) to complete this task, ensuring that all the requirements are met.
Car Requirements:
- Less than 50,000km
- Off road capabilities (4 Wheel Drive)
- 5 seats
- Total spent including loan repayments cannot exceed $40,000
Instructions
1. Select vehicles from link provided https://www.carsales.com.au (remember that repayments available may change what can you can or can't recommend so perhaps select 3-5 cars before moving to step 2)
2. Calculate a loan from the links provided Westpac Calculator , NAB Calculator , BOQ Calculator
3. Create a Payment plan for the Car that you feel is the best suited to the Smith family
4. Create a small presentation based on the payment plan justifying you reasons for selecting this particular payment plan.
Evaluation
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Appropriate use of mathematical terminology and conventions in simple routine financial situations
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Development of logical sequences in simple routine financial situations using everyday and/or mathematical language
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Informed decisions based on mathematical reasoning in simple routine financial situations
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Selection and use of technology
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use of rules and formulas in simple routine financial situations
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Conclusion
Well done! You have now completed your task.
Can you now see the difference taking a loan on a compounding interest rate in comparison to one that has a simple fixed interest rate?
The next lesson we will begin work on your assignments that will have you navigating similar sites to work out a loan for yourself.
So to help you get started revise the work we have done on simple and compound interest by completing the following questions in your own time.
a) Calculate compound interest on $20,000 over 5 years
b) Calculate simple interest on $20,000 over 10 years
Credits
References
ACARA. (2018). The Australian Curriculum General Capabilities Information and Communication Technology Capability learning continuum.Education Queensland.
Retrieved from https://www.australiancurriculum.edu.au/media/1074/general-capabilities-information-and-communication-ict-capability-learning-continuum.pdf
ACARA. (2018). The Australian Curriculum Mathematics Year 10. Education Queensland
Anderson, L. W., & Krathwohl, D. R. (Eds.). (2001). A taxonomy for learning, teaching and assessing: A revision of Bloom's Taxonomy of educational objectives
Pinantoan, A, (2013). Webquests – An Introductory Guide and Resources
Retrieved from https://www.opencolleges.edu.au/informed/teacher-resources/webquests/
Teacher Page
Rationale
WebQuests are ideal in classrooms as they allow for students to begin utilising ICT as a tool to answer questions posed in the classroom. It is important that they do see it as a tool for solving problems and do not become reliant on digital technologies. WebQuests also foster independent thought as a majority will have students research and develop an answer themselves. This independent thinking sets the basis for developing higher order thinking skills and shows how effective WebQuests can be in the classroom (Pinantoan,2013).
This particular WebQuest is aimed at a year 10 maths class and is aimed to engage students of all learning abilities. The activity aligns with the math curriculum (ACMNA229) and also with a range of ICT skills outlined on the ICT continuum. Through the analysis of a variety of loan types in relation to a variety of cars students will create a a payment plan that they will present. This directly aligns with the level 6 criteria for the 'Creating with ICT' on the continuum and highlights the effectiveness of this activity.
Mathematically this activity builds on students knowledge of simple interest and begins to introduce compound interest which is directly from the curriculum linked provided. The use of cars in this activity also introduces the idea of depreciation which is part of the Math A syllabus and shows how this activity allows students to easily interact with extension content.
On top of the alignment with the curriculum this WebQuest also incorporates elements of learning theories. Creating, evaluating and analysing are all elements of this particular activity, they form the upper echelon of Bloom's Hierarchy and show the implementation of higher order thinking that this WebQuest invokes (Anderson, 2001). Students evaluate when they critique the variety of loans that they run via the online calculators and then Create a payment plan based on this evaluation.