The Shape of Saving
Watch how monthly deposits build maturity over time in a Recurring Deposit.
Equation
y = 500x + 1000
Graph
Table
| x | y |
|---|---|
| 0 | 1000 |
| 1 | 1500 |
| 2 | 2000 |
| 3 | 2500 |
| 4 | 3000 |
| 5 | 3500 |
| 6 | 4000 |
| 7 | 4500 |
| 8 | 5000 |
| 9 | 5500 |
| 10 | 6000 |
| 11 | 6500 |
| 12 | 7000 |
What this lesson covers
What you do
You shape the function y = m*x + c and watch the graph answer.
Challenges to clear
- Set the monthly deposit to Rs 1000: make the slope m equal 1000.
- No initial deposit: slide c to 0 and check the maturity after 12 months is Rs 12000.
- A bigger monthly deposit: slide m to 1500.
- There is an opening balance too. Slide c until the 12-month maturity reads 20,000 — the deposits alone only reach 18,000.
Check yourself
In the equation Maturity = (Monthly Deposit) * Months + Initial Amount, what does the slope 'm' represent?
- The total interest earned over the year
- The fixed amount deposited every month — correct
- The initial amount put in at the start
- The final maturity value
Think about it
- If you increase the monthly deposit (m), how does the steepness of the line change?
- If you start with an initial amount (c > 0), where does the line begin on the y-axis?