Teachers’ knowledge for teaching compound interest

Abstract

There is increasing acknowledgement that teachers’ knowledge for teaching mathematics is multifaceted and topic specific. Given the paucity of research on the teaching and learning of financial mathematics in general, little can be known about teachers’ knowledge for teaching compound interest. However, since financial mathematics is a component of the school curriculum in South Africa, and an important element of financial literacy more broadly, attention needs to be given to knowledge for teaching financial mathematics, and compound interest in particular. Drawing from a larger study in which the author taught a financial mathematics course to pre-service secondary mathematics teachers, a theoretical elaboration is provided of the underlying mathematics of compound interest, and connections with the world of banking. Based on findings from the study, two key student errors are identified: the over-generalisation of linear thinking in multiplicative scenarios, and the over-generalisation of reversible operations in percentage-change scenarios. Taken together, teachers’ knowledge of relevant mathematics, of the banking context and of learners’ conceptions will contribute to building a knowledge-base for teachers’ knowledge for teaching compound interest.

An instrumental genesis perspective on the students' using spreadsheet for the interest concept and calculations

“…In studies in which percentage, rate, and interest types are handled together, there are some difficulties such as; the confusion between the calculations of interest types, the inability to perform meaningful calculations (Sugden & Miller, 2011), the inability to explain the interest calculations based on variables (Bakker et.al, 2006;Hoyles et.al, 2010;Hubbard et al, 2016) the inability to establish and interpret the relationship (Pournara, 2013) as well. The maintain difficulties are such as; the difference in the number of periods and time synchronization of simple and compound interest calculations (Feng & Kwan, 2015), the incorrect use of interest rates in calculations (Chong, et al, 2015), the inability to detect abnormal values due to not following current interest parameters (Sugden & Miller, 2011), the inability to compare the differences of the parameters of the interest types (Marley-Payne & Dituri, 2019).…”

“…Percentage and interest calculations are the concepts handled in various levels of mathematics education. They are also included in curriculums (MEB, 2013;Pournara, 2013;Sugden et al, 2015;YÖK, 2020). In the literature, it is seen that students have some difficulties related to the concept of interest.…”

Simulation-optimization framework in urban flood management for historic and climate change scenarios

“…This increment in the budget was handled using a simple interest method (Equation ( 1)), where the increment in cost is treated as the O & M% for extended life (Pournara 2013).…”

Deepening pre-service secondary teachers’ mathematical content knowledge through engaging with peers’ mathematical contributions

“…Drawing on these notions of depth, breadth and connectedness, I have developed a hierarchy of concepts relating to compound interest and annuities (Pournara, 2013(Pournara, , 2014. Following Ma (1999), I have argued that percentage is a powerful idea and that linear growth, exponential growth and progressions (arithmetic and geometric) can be placed at consecutively higher levels within the hierarchy 3 .…”