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Math 136 Computer Activities Name:____________________ Group Members:_________________ ______________________________ Consumer Math Activity: Creating Wealth This computer lab explores the following questions:  What is "wealthy"?  What groups hold most of the wealth in America and where do they live?  How is wealth created? 1. Go to http://www.forbes.com/2005/09/15/hometowns-networthsamerica-richest_05rich400_map.html. (You may have to click to skip the welcome screen) View the map. a. Where is wealth concentrated? b. Give an explanation for the feature(s) on the map of Washington State. Use the pull-down menu of states to see if you are correct. c. Check the list of wealthy New Jerseyans, and compare it with the list from California. Write down anything you notice that is different between the two lists. d. If you bought a video iPod @$249 every day, calculate how many years it would take to spend $1 billion. 2. Go to www.progressiveschoolhouse.org/wealth/richest.htm and click on ‘The American Pie’ to view the pie chart there. a. What fraction of America’s wealth is held by the top 1% wealthiest people, according to the pie chart? Math 136 Computer Activities b. What fraction is held by the bottom 10%? c. What does it mean that a fraction of the population has a negative net worth? 3. There are many ways to build wealth. One way is by saving. Go to www.myfico.com/CreditEducation/Calculators/Millionaire.aspx and use the calculator there to try out different methods for amassing one million dollars. a. Assume you have initially $1,000 to deposit. You then set up a monthly deposit plan with $200 from your paycheck going into savings each month. Assume the annual interest rate you will get is 4%. Use the calculator with your current age to find the age at which you will ‘become a millionaire.’ You will need to set a target age (guess). Hit ‘View Report’ to read the age at which you will become a millionaire given the initial conditions. Write that age here: b. In order to decrease the age at which you will become a millionaire, you can: increase the initial deposit, and/or increase the monthly deposit, and/or get a higher interest rate. Try changing each of these variables and use the table below to record your findings. Initial Deposit $1,000 $5,000 $10,000 $1,000 same same $1,000 same same c. Monthly Annual Deposit interest rate (%) $200 4 same same same same $500 $750 $1,000 $200 same same 4 same same 5 7 10 Age to accumulate $1 million Write two sentences that summarize your findings on how long it takes to save a million dollars given your initial starting conditions. Include your observation of what variable(s) have the biggest impact on the time. Math 136 Computer Activities 4. One way to save is with certificates of deposit or CDs. Go to www.javacalc.com and click on View All Savings Calculators and then on Certificate of Deposits Calculator. a. The CD calculator requires an interest rate. To use a rate that is current, go to www.bankrate.com/brm/rate/deposits_home.asp and find current interest rates for CDs of different lengths. Write your findings in the table below. (Use the rates given on the home page, not the state-by-state rates.) Length of CD 6-month 1-yr 5-yr b. Different banks use different compounding schemes for their Certificates of Deposit. Use the CD calculator to compute the value of a $1,000 CD of various lengths, changing the compounding scheme. Write the results in the table below. Compounding Maturity value of CD $1,000 6-month Monthly Daily 1-yr Annually Semi-annually Monthly Daily 5-yr Annually Semi-annually Quarterly Monthly Daily *Note: Length of CD must be entered in months. c. Complete the following sentences to summarize your findings: Investing $1,000 in a 5-yr CD vs. a 6-month CD results in: Daily compounding vs. annual compounding, for a 5-yr CD, results in: Initial Deposit Length of CD* Interest rate Interest rate Math 136 Computer Activities d. Use the compound interest formula A  p1    r  to check by hand n nt (calculator) the result javacalc gave in Problem 4 for a 1-yr CD compounded monthly. Recall that A is the amount, p is the principal, r is the annual interest rate, t is the time in years, and n is the number of compounding periods per year. 5. Investing in real estate is the way that a large number of Americans have created wealth over the past 50 years. In this problem, you will calculate how much money a house purchased in the 1970s in New Jersey has appreciated up to now. Then you will compare how much money would have been earned if the purchase price had been invested for the same length of time at a typical interest rate. a. Mina and Joe Soltes purchased a 3-bedroom, 1 ½ -bath home in 1972 in Middletown, NJ for $40,000. Go to http://www.momls.com and find a home for sale matching these characteristics. Write the asking price here: b. Subtract the asking price from the purchase price to calculate the amount they would earn upon sale of their house (assuming there is no mortgage and neglecting the costs of repairs, upgrades, etc). c. Now calculate how much the initial investment of $40,000 would be worth today if it had been invested for 35 years at 5% interest compounded annually. Use the compound interest formula. d. Comment on your findings. What factors have not been considered? How would these change the calculations? Math 136 Computer Activities Math 136 Ideas for Computer Activities – Roads not traveled The following ideas never made it to the drawing board. If anyone has more information on how we can use these ideas, or would like to write up a lab for us, that would be terrific! Logic What about an activity with circuits? Or a truth table applet? I looked all over and could not find a good, user friendly one. If anyone is an amateur (or professional) programmer and would like to do something with this, email me!! Probability Shodor has terrific simulations with spinners, dice and more. We just need someone with enthusiasm to dream something up. Statistics Is there some way we could collect real-time data from a site? I'm thinking of traffic (actual traffic)? or number of hits on a site? Maybe weather related. There is something that tabulates google searches. Another group of sites students might be interested in is Soundscan, HDD and allaccess. Those sites tabulate CD sales over time and radio plays over time. There are also so many sites of national data for date collection, which students could go to on the first day of the stats section. An instructor's presence can make the data collection go more efficiently. They could even do this in groups. Numeration There's a whole host of sites on Egyptian fractions, all at: http://www.ics.uci.edu/~eppstein/numth/egypt/ Maybe we could think of an extension to do with this? Or even better, here is a sight that does calculators in various number systems, and the abacus: http://www.martindalecenter.com/Calculators2_2_Old.html Graph Theory When we have our smart classrooms, it would be great to project a map onto the whiteboard and then show how you can make a graph right out of it by replacing the land masses or states with dots.