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- [Instructor] We're told Lena puts $35
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in her savings account
each month for nine months.
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She earns $1.25 total
interest during that time.
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What is the balance
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in Lena's savings account
after nine months?
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Pause this video, have a go at it.
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Okay, so first, we just have to calculate
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how much she put in and
then add the interest.
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So, the amount that she
puts in is $35 per month
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times nine months.
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So, if we take $35 times nine months,
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9 times 5 is 45,
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9 times 3 is 27, plus 4 is 31.
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So, that's how much she deposits,
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but she also got interest on that.
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So, if we then add another $1.25
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so then if we add all of this together,
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we're going to get $316.25
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as our answer, we're done.
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Now, some of you might be saying,
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"What is this interest thing
and why are banks paying it?"
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Well, when you put money in your bank,
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well, they want you to
put money in the bank
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because they can do
things with that money.
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They can sometimes lend
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some of that money out to other people,
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and when they lend it to other people,
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they make interest on that
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so they are essentially paying you
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to be able to lend your money out.
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So, that's what interest is.
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It's the bank paying you
to keep money with them
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that they can just use for other things.
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But that's why it's sometimes
good to keep it with a bank,
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because you're not just saving directly
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the money that you save,
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but you're actually
earning extra money on it
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for someone to be able
to keep it in the bank,
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and it's oftentimes convenient and safe
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to keep it in the bank.
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Easy to keep track of.