Consumer Mathematics refers to practical mathematical techniques/concepts which can be utilized in everyday life. These techniques/concepts are usually taught at the high school level of education – they include the use of fractions, percentages and decimals as well as very basic algebra. The practical applications of such concepts extend to monetary issues such as taxes, budgeting as well as interest rates.
For example, consider the following scenario: a person borrows $100,000 for 5 years at 5% simple annual interest. Calculate the interest after this period.
In the above scenario, one would resort to simple Consumer Mathematics to calculate the interest:
Simple Interest = p*i*n
P is the amount borrowed
I is the interest rate
N is the number of years
Simple Interest = 100000*0.05*5 = $25,000
Thus, it can be seen that Consumer Mathematics is useful to know, as simple computational skills will prove to be extremely practical in everyday life.