Module 2 Summary

 

The graph of a stock is much like people’s financial lives. Everyone experiences highs and lows. At times you seem to be charging ahead; at other times the unexpected seems to put you in reverse. What is true for government and business is also true for individuals.

 

People must learn from both the good times and the bad. You must accept that some times are meant for saving and that borrowing, on other occasions, may be required to get by. This module passes on a few tools to handle both situations.

 

In Section 1 you explored the calculations for simple and compound interest. You discovered that for a given interest rate and interest period, compound interest quickly outpaces simple interest. You estimated, using the Rule of 72, the time required to double an investment through compounding interest. The disparity between simple and compound interest was clarified when you examined the graphs of each investment type over time.

 

In Section 2, through the project on consumer credit, you researched the different credit options available at your local financial institutions. You used this knowledge of credit to make appropriate decisions on how you can use debt to reach your financial goals.