Key Concepts

Key Concepts

• Percent Increase To find the percent increase:
  
  1. Find the amount of increase. \(\text{increase}=\text{new amount}-\text{original}\phantom{\rule{0.2em}{0ex}}\text{amount}\)
  2. Find the percent increase. Increase is what percent of the original amount?
• Percent Decrease To find the percent decrease:
  
  1. Find the amount of decrease. \(\text{decrease}=\text{original amount}-\text{new}\phantom{\rule{0.2em}{0ex}}\text{amount}\)
  2. Find the percent decrease. Decrease is what percent of the original amount?
• Simple Interest If an amount of money, P, called the principal, is invested for a period of t years at an annual interest rate r, the amount of interest, I, earned is
  \(\begin{array}{ccc}\hfill I& =\hfill & Prt\hfill \\ \hfill \text{where}\phantom{\rule{1em}{0ex}}I& =\hfill & \text{interest}\hfill \\ \hfill P& =\hfill & \text{principal}\hfill \\ \hfill r& =\hfill & \text{rate}\hfill \\ \hfill t& =\hfill & \text{time}\hfill \end{array}\)
• Discount
  
  • amount of discount is discount rate \(·\) original price
  • sale price is original price – discount
• Mark-up
  
  • amount of mark-up is mark-up rate \(·\) original cost
  • list price is original cost + mark up

Glossary

amount of discount

The amount of discount is the amount resulting when a discount rate is multiplied by the original price of an item.

discount rate

The discount rate is the percent used to determine the amount of a discount, common in retail settings.

interest

Interest is the money that a bank pays its customers for keeping their money in the bank.

list price

The list price is the price a retailer sells an item for.

mark-up

A mark-up is a percentage of the original cost used to increase the price of an item.

original cost

The original cost in a retail setting, is the price that a retailer pays for an item.

principal

The principal is the original amount of money invested or borrowed for a period of time at a specific interest rate.

rate of interest

The rate of interest is a percent of the principal, usually expressed as a percent per year.

simple interest

Simple interest is the interest earned according to the formula $I=Prt.$