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Hey there! Ready to learn how money works when you get a job? Let's explore paychecks and banks together!
When you work a job, you earn money called income. Your employer gives you a paycheck, but you do not get to keep all of it because some money is taken out for taxes.
Your total earnings before any taxes are taken out is called your gross pay. The money you actually take home after taxes is your net pay.
To keep your net pay safe, you put it into a bank account. A checking account lets you spend money easily with a card, while a savings account helps you save for the future.
Imagine a town has 500 working teenagers. You ask a random group of 50 teenagers about their bank accounts. Out of those 50 teens, 40 of them have a savings account. Based on this sample, predict how many of the 500 total teenagers in the town have a savings account.
- First, look at your sample. The sample size is 50 teenagers.
- Next, find the fraction of teens in the sample who have a savings account. That is 40 out of 50, which simplifies to 4/5 or 0.80.
- Now, apply this fraction to the whole population of 500 teenagers in the town.
- Multiply the total population by the fraction: 500 times 0.80.
- Calculate the final answer: 500 multiplied by 0.80 equals 400.
- So, you can predict that about 400 teenagers in the town have a savings account.
