MATH : EXAM 2 REVIEW. A = P 1 + AP R ) ny

Size: px
Start display at page:

Download "MATH : EXAM 2 REVIEW. A = P 1 + AP R ) ny"

Transcription

1 MATH : EXAM 2 REVIEW Origially, I was havig you all memorize the basic compoud iterest formula. I ow wat you to memorize the geeral compoud iterest formula. This formula, whe = 1, is the same as the basic compoud iterest formula. Because they will ot put it o your fial, I wat you to memorize it ow. I would also like you to kow the formulas for the geeral equatio for a lie, the chage i depedet variable, ad the rate of chage. These are all as follows. Memorize the followig: Compoud iterest formula for iterest paid times a year: ( A = P 1 + AP R ) Y Geeral Equatio for a lie: y = mx + b, or depedet variable = rate of chage idepedet variable + iitial value (or y-itercept). Chage i depedet variable: chage i depedet variable = rate of chage chage i idepedet variable Rate of chage: rate of chage = slope = m = chage i depedet variable chage i idepedet variable = rise chage i y ru = chage i x Kow whe ad be able to use the followig: (you do t eed to memorize these) Compoud iterest formula for cotiuous compoudig: Savigs pla formula: Loa paymet formula: A = P MT P MT = [ (AP R Y ) A = P e [ (1 ) ] + AP R (Y ) 1 AP R P AP R ) ] ( Y ) 1 ( 1 + AP R Doublig Time ad Halvig Time formulas: ew value = iitial value 2 t/t double T double 70 P ew value = iitial value ( ) 1 t/thalf 2 T half 70 P Logistic growth: ( ) populatio logistic growth rate = r 1 carryig capacity Equatios for Expoetial fuctios Q = Q 0 (1 + r) t Q = Q 0 2 t/t double Q = Q 0 ( 1 2 ) t/tdouble

2 1. Suppose you put a sigle deposit of $6, 500 ito a accout with a APR of 5%, compouded daily. How much moey will this be i 7 years? 2. Fid the savigs pla balace after 18 moths with a APR of 6% ad mothly paymets of $ You put $200 per moth i a ivestmet pla that pays a APR of 4.5%. How much moey will you have after 18 years? Compare this amout to the total deposits made over the time period. 4. You ited to create a college fud for your baby. If you ca get a APR of 7.5% ad wat the fud to have a value of $150, 000 after 18 years, how much should you deposit mothly? 5. Suppose you are 30 years old ad would like to retire at age 60. Furthermore, you would like to have a retiremet fud from which you ca draw a icome of $100, 000 per year forever! How ca you do it? Assume a costat APR of 6%. 6. Assume you have a balace of $5, 000 o your credit card. The credit card APR is 21% ad you wat to pay off the balace i 3 years. Calculate the mothly paymet ad total paymet uder these coditios. Assume you make o additioal charges o your card. 7. You have a car loa of $7, 500 at a fixed APR of 5.8% for 3 years. Calculate your mothly paymets ad also calculate the total amout that you paid i iterest over 3 years.

3 8. A accout has a APR of 5.3%. You deposit $5, 000. What is your APY whe compoudig occurs quarterly? mothly? daily? 9. Determie whether the followig examples are expoetial or liear growth (or decay). (a) The populatio of Tucso is icreasig at a rate of 3% per year. (b) The price of a gallo of gasolie is icreasig by $0.04 per week. (c) The value of your car is decreasig at a rate of 12% per year. 10. Oil cosumptio is icreasig at a rate of 2.1% per year. What is its doublig time? By what factor will oil cosumptio icrease i te years? 11. Suppose there are 3 bacteria i a bottle at 5 pm ad that the doublig time for bacteria is 3 miutes. How may bacteria will there be i the bottle at 5:09 pm? 12. The half-life of a drug i the bloodstream is 4 hours. By what factor does the cocetratio decrease i 24 hours? 13. Poachig is causig a populatio of elephats to declie by 9% per year. What is the half-life for the populatio? If there are 10,000 elephats today, how may will remai i 50 years?

4 14. Use the curret aual growth rate of the Uited States, which is about 0.7%, to fid the approximate doublig time of world populatio ad to predict world populatio i 2050 based o a 2000 populatio of 6.0 billio. 15. Oe morig, there were 5 iches of sow o the groud. The the witer storm started ad sow started accumulatig at a costat rate of 3 iches every 2 hours. (a) Idetify the idepedet ad depedet variables: idepedet variable depedet variable (b) Write a liear equatio that describes this situatio. (c) How log did it take for the height of the sow to reach 17 iches? 16. For each of the followig fuctios, fid the slope of the graph ad the y-itercept. The sketch the graph for values of x betwee -10 ad 10. (a) y = 3x + 3 (b) y = 4x + 1 (c) y = 5 (d) y = 2x 17. Suppose your pet dog weighed 2.5 pouds at birth ad weighed 15 pouds after oe year. Based o these two data poits, fid a liear fuctio to predict your dog s weight at 5 ad 10 years of age. Commet o the validity of the model.

5 18. I 1993, Americas recycled 43.8 millio tos of solid waste. I 1997, the figure grew to about 60.8 millio tos. Fid a liear fuctio that fits the data. Use this fuctio to predict the amout recycled i (Hit: Assume 1993 is time t = The half-life of aspiri i your blood stream is 3.1 hours. What percet does it decrease by per hour (i.e., what is the rate of decay)? 20. Usig the iformatio i exercise 18, aswer the followig questio. If you take 2 aspiri (650 mg total) at 8 o clock i the morig, at what time should you take a secod dose? (Assume that you take the secod dose whe your headache returs - whe there is oly 100 mg left i your bloodstream.)

2. Find the annual percentage yield (APY), to the nearest hundredth of a %, for an account with an APR of 12% with daily compounding.

2. Find the annual percentage yield (APY), to the nearest hundredth of a %, for an account with an APR of 12% with daily compounding. 1. Suppose that you ivest $4,000 i a accout that ears iterest at a of 5%, compouded mothly, for 58 years. `Show the formula that you would use to determie the accumulated balace, ad determie the accumulated

More information

Section 3.3 Exercises Part A Simplify the following. 1. (3m 2 ) 5 2. x 7 x 11

Section 3.3 Exercises Part A Simplify the following. 1. (3m 2 ) 5 2. x 7 x 11 123 Sectio 3.3 Exercises Part A Simplify the followig. 1. (3m 2 ) 5 2. x 7 x 11 3. f 12 4. t 8 t 5 f 5 5. 3-4 6. 3x 7 4x 7. 3z 5 12z 3 8. 17 0 9. (g 8 ) -2 10. 14d 3 21d 7 11. (2m 2 5 g 8 ) 7 12. 5x 2

More information

1 Savings Plans and Investments

1 Savings Plans and Investments 4C Lesso Usig ad Uderstadig Mathematics 6 1 Savigs las ad Ivestmets 1.1 The Savigs la Formula Lets put a $100 ito a accout at the ed of the moth. At the ed of the moth for 5 more moths, you deposit $100

More information

Using Math to Understand Our World Project 5 Building Up Savings And Debt

Using Math to Understand Our World Project 5 Building Up Savings And Debt Usig Math to Uderstad Our World Project 5 Buildig Up Savigs Ad Debt Note: You will have to had i aswers to all umbered questios i the Project Descriptio See the What to Had I sheet for additioal materials

More information

Date: Practice Test 6: Compound Interest

Date: Practice Test 6: Compound Interest : Compoud Iterest K: C: A: T: PART A: Multiple Choice Questios Istructios: Circle the Eglish letter of the best aswer. Circle oe ad ONLY oe aswer. Kowledge/Thikig: 1. Which formula is ot related to compoud

More information

Chapter Four Learning Objectives Valuing Monetary Payments Now and in the Future

Chapter Four Learning Objectives Valuing Monetary Payments Now and in the Future Chapter Four Future Value, Preset Value, ad Iterest Rates Chapter 4 Learig Objectives Develop a uderstadig of 1. Time ad the value of paymets 2. Preset value versus future value 3. Nomial versus real iterest

More information

1 The Power of Compounding

1 The Power of Compounding 1 The Power of Compoudig 1.1 Simple vs Compoud Iterest You deposit $1,000 i a bak that pays 5% iterest each year. At the ed of the year you will have eared $50. The bak seds you a check for $50 dollars.

More information

2. The Time Value of Money

2. The Time Value of Money 2. The Time Value of Moey Problem 4 Suppose you deposit $100 i the bak today ad it ears iterest at a rate of 10% compouded aually. How much will be i the accout 50 years from today? I this case, $100 ivested

More information

Chapter 4: Time Value of Money

Chapter 4: Time Value of Money FIN 301 Class Notes Chapter 4: Time Value of Moey The cocept of Time Value of Moey: A amout of moey received today is worth more tha the same dollar value received a year from ow. Why? Do you prefer a

More information

Chapter Six. Bond Prices 1/15/2018. Chapter 4, Part 2 Bonds, Bond Prices, Interest Rates and Holding Period Return.

Chapter Six. Bond Prices 1/15/2018. Chapter 4, Part 2 Bonds, Bond Prices, Interest Rates and Holding Period Return. Chapter Six Chapter 4, Part Bods, Bod Prices, Iterest Rates ad Holdig Period Retur Bod Prices 1. Zero-coupo or discout bod Promise a sigle paymet o a future date Example: Treasury bill. Coupo bod periodic

More information

Chapter Four 1/15/2018. Learning Objectives. The Meaning of Interest Rates Future Value, Present Value, and Interest Rates Chapter 4, Part 1.

Chapter Four 1/15/2018. Learning Objectives. The Meaning of Interest Rates Future Value, Present Value, and Interest Rates Chapter 4, Part 1. Chapter Four The Meaig of Iterest Rates Future Value, Preset Value, ad Iterest Rates Chapter 4, Part 1 Preview Develop uderstadig of exactly what the phrase iterest rates meas. I this chapter, we see that

More information

Chapter 3. Compound interest

Chapter 3. Compound interest Chapter 3 Compoud iterest 1 Simple iterest ad compoud amout formula Formula for compoud amout iterest is: S P ( 1 Where : S: the amout at compoud iterest P: the pricipal i: the rate per coversio period

More information

APPLICATION OF GEOMETRIC SEQUENCES AND SERIES: COMPOUND INTEREST AND ANNUITIES

APPLICATION OF GEOMETRIC SEQUENCES AND SERIES: COMPOUND INTEREST AND ANNUITIES APPLICATION OF GEOMETRIC SEQUENCES AND SERIES: COMPOUND INTEREST AND ANNUITIES Example: Brado s Problem Brado, who is ow sixtee, would like to be a poker champio some day. At the age of twety-oe, he would

More information

Class Sessions 2, 3, and 4: The Time Value of Money

Class Sessions 2, 3, and 4: The Time Value of Money Class Sessios 2, 3, ad 4: The Time Value of Moey Associated Readig: Text Chapter 3 ad your calculator s maual. Summary Moey is a promise by a Bak to pay to the Bearer o demad a sum of well, moey! Oe risk

More information

0.07. i PV Qa Q Q i n. Chapter 3, Section 2

0.07. i PV Qa Q Q i n. Chapter 3, Section 2 Chapter 3, Sectio 2 1. (S13HW) Calculate the preset value for a auity that pays 500 at the ed of each year for 20 years. You are give that the aual iterest rate is 7%. 20 1 v 1 1.07 PV Qa Q 500 5297.01

More information

We learned: $100 cash today is preferred over $100 a year from now

We learned: $100 cash today is preferred over $100 a year from now Recap from Last Week Time Value of Moey We leared: $ cash today is preferred over $ a year from ow there is time value of moey i the form of willigess of baks, busiesses, ad people to pay iterest for its

More information

Chapter 5: Sequences and Series

Chapter 5: Sequences and Series Chapter 5: Sequeces ad Series 1. Sequeces 2. Arithmetic ad Geometric Sequeces 3. Summatio Notatio 4. Arithmetic Series 5. Geometric Series 6. Mortgage Paymets LESSON 1 SEQUENCES I Commo Core Algebra I,

More information

CHAPTER 2 PRICING OF BONDS

CHAPTER 2 PRICING OF BONDS CHAPTER 2 PRICING OF BONDS CHAPTER SUARY This chapter will focus o the time value of moey ad how to calculate the price of a bod. Whe pricig a bod it is ecessary to estimate the expected cash flows ad

More information

Single-Payment Factors (P/F, F/P) Single-Payment Factors (P/F, F/P) Single-Payment Factors (P/F, F/P)

Single-Payment Factors (P/F, F/P) Single-Payment Factors (P/F, F/P) Single-Payment Factors (P/F, F/P) Sigle-Paymet Factors (P/F, F/P) Example: Ivest $1000 for 3 years at 5% iterest. F =? i =.05 $1000 F 1 = 1000 + (1000)(.05) = 1000(1+.05) F 2 = F 1 + F 1 i = F 1 (1+ = 1000(1+.05)(1+.05) = 1000(1+.05) 2

More information

Annual compounding, revisited

Annual compounding, revisited Sectio 1.: No-aual compouded iterest MATH 105: Cotemporary Mathematics Uiversity of Louisville August 2, 2017 Compoudig geeralized 2 / 15 Aual compoudig, revisited The idea behid aual compoudig is that

More information

Course FM Practice Exam 1 Solutions

Course FM Practice Exam 1 Solutions Course FM Practice Exam 1 Solutios Solutio 1 D Sikig fud loa The aual service paymet to the leder is the aual effective iterest rate times the loa balace: SP X 0.075 To determie the aual sikig fud paymet,

More information

FINANCIAL MATHEMATICS

FINANCIAL MATHEMATICS CHAPTER 7 FINANCIAL MATHEMATICS Page Cotets 7.1 Compoud Value 116 7.2 Compoud Value of a Auity 117 7.3 Sikig Fuds 118 7.4 Preset Value 121 7.5 Preset Value of a Auity 121 7.6 Term Loas ad Amortizatio 122

More information

Chapter 5 Time Value of Money

Chapter 5 Time Value of Money Chapter 5 Time Value of Moey 1. Suppose you deposit $100 i a bak that pays 10% iterest per year. How much will you have i the bak oe year later? 2. Suppose you deposit $100 i a bak that pays 10% per year.

More information

Today: Finish Chapter 9 (Sections 9.6 to 9.8 and 9.9 Lesson 3)

Today: Finish Chapter 9 (Sections 9.6 to 9.8 and 9.9 Lesson 3) Today: Fiish Chapter 9 (Sectios 9.6 to 9.8 ad 9.9 Lesso 3) ANNOUNCEMENTS: Quiz #7 begis after class today, eds Moday at 3pm. Quiz #8 will begi ext Friday ad ed at 10am Moday (day of fial). There will be

More information

LESSON #66 - SEQUENCES COMMON CORE ALGEBRA II

LESSON #66 - SEQUENCES COMMON CORE ALGEBRA II LESSON #66 - SEQUENCES COMMON CORE ALGEBRA II I Commo Core Algebra I, you studied sequeces, which are ordered lists of umbers. Sequeces are extremely importat i mathematics, both theoretical ad applied.

More information

Calculation of the Annual Equivalent Rate (AER)

Calculation of the Annual Equivalent Rate (AER) Appedix to Code of Coduct for the Advertisig of Iterest Bearig Accouts. (31/1/0) Calculatio of the Aual Equivalet Rate (AER) a) The most geeral case of the calculatio is the rate of iterest which, if applied

More information

Dr. Maddah ENMG 400 Engineering Economy 06/24/09. Chapter 2 Factors: How time and interest affect money

Dr. Maddah ENMG 400 Engineering Economy 06/24/09. Chapter 2 Factors: How time and interest affect money Dr Maddah ENM 400 Egieerig Ecoomy 06/4/09 Chapter Factors: How time ad iterest affect moey Sigle Paymet Factors Recall that P dollars ow are equivalet to F dollars after time periods at a iterest rate

More information

STRAND: FINANCE. Unit 3 Loans and Mortgages TEXT. Contents. Section. 3.1 Annual Percentage Rate (APR) 3.2 APR for Repayment of Loans

STRAND: FINANCE. Unit 3 Loans and Mortgages TEXT. Contents. Section. 3.1 Annual Percentage Rate (APR) 3.2 APR for Repayment of Loans CMM Subject Support Strad: FINANCE Uit 3 Loas ad Mortgages: Text m e p STRAND: FINANCE Uit 3 Loas ad Mortgages TEXT Cotets Sectio 3.1 Aual Percetage Rate (APR) 3.2 APR for Repaymet of Loas 3.3 Credit Purchases

More information

1 + r. k=1. (1 + r) k = A r 1

1 + r. k=1. (1 + r) k = A r 1 Perpetual auity pays a fixed sum periodically forever. Suppose a amout A is paid at the ed of each period, ad suppose the per-period iterest rate is r. The the preset value of the perpetual auity is A

More information

Financial Analysis. Lecture 4 (4/12/2017)

Financial Analysis. Lecture 4 (4/12/2017) Fiacial Aalysis Lecture 4 (4/12/217) Fiacial Aalysis Evaluates maagemet alteratives based o fiacial profitability; Evaluates the opportuity costs of alteratives; Cash flows of costs ad reveues; The timig

More information

Class Notes for Managerial Finance

Class Notes for Managerial Finance Class Notes for Maagerial Fiace These otes are a compilatio from:. Class Notes Supplemet to Moder Corporate Fiace Theory ad Practice by Doald R. Chambers ad Nelso J. Lacy. I gratefully ackowledge the permissio

More information

SIMPLE INTEREST, COMPOUND INTEREST INCLUDING ANNUITY

SIMPLE INTEREST, COMPOUND INTEREST INCLUDING ANNUITY Chapter SIMPLE INTEREST, COMPOUND INTEREST INCLUDING ANNUITY 006 November. 8,000 becomes 0,000 i two years at simple iterest. The amout that will become 6,875 i years at the same rate of iterest is:,850

More information

Course FM/2 Practice Exam 1 Solutions

Course FM/2 Practice Exam 1 Solutions Course FM/2 Practice Exam 1 Solutios Solutio 1 D Sikig fud loa The aual service paymet to the leder is the aual effective iterest rate times the loa balace: SP X 0.075 To determie the aual sikig fud paymet,

More information

Subject CT1 Financial Mathematics Core Technical Syllabus

Subject CT1 Financial Mathematics Core Technical Syllabus Subject CT1 Fiacial Mathematics Core Techical Syllabus for the 2018 exams 1 Jue 2017 Subject CT1 Fiacial Mathematics Core Techical Aim The aim of the Fiacial Mathematics subject is to provide a groudig

More information

Inferential Statistics and Probability a Holistic Approach. Inference Process. Inference Process. Chapter 8 Slides. Maurice Geraghty,

Inferential Statistics and Probability a Holistic Approach. Inference Process. Inference Process. Chapter 8 Slides. Maurice Geraghty, Iferetial Statistics ad Probability a Holistic Approach Chapter 8 Poit Estimatio ad Cofidece Itervals This Course Material by Maurice Geraghty is licesed uder a Creative Commos Attributio-ShareAlike 4.0

More information

First determine the payments under the payment system

First determine the payments under the payment system Corporate Fiace February 5, 2008 Problem Set # -- ANSWERS Klick. You wi a judgmet agaist a defedat worth $20,000,000. Uder state law, the defedat has the right to pay such a judgmet out over a 20 year

More information

Pension Annuity. Policy Conditions Document reference: PPAS1(6) This is an important document. Please keep it in a safe place.

Pension Annuity. Policy Conditions Document reference: PPAS1(6) This is an important document. Please keep it in a safe place. Pesio Auity Policy Coditios Documet referece: PPAS1(6) This is a importat documet. Please keep it i a safe place. Pesio Auity Policy Coditios Welcome to LV=, ad thak you for choosig our Pesio Auity. These

More information

MS-E2114 Investment Science Exercise 2/2016, Solutions

MS-E2114 Investment Science Exercise 2/2016, Solutions MS-E24 Ivestmet Sciece Exercise 2/206, Solutios 26.2.205 Perpetual auity pays a xed sum periodically forever. Suppose a amout A is paid at the ed of each period, ad suppose the per-period iterest rate

More information

Math of Finance Math 111: College Algebra Academic Systems

Math of Finance Math 111: College Algebra Academic Systems Math of Fiace Math 111: College Algebra Academic Systems Writte By Bria Hoga Mathematics Istructor Highlie Commuity College Edited ad Revised by Dusty Wilso Mathematics Istructor Highlie Commuity College

More information

MA Lesson 11 Section 1.3. Solving Applied Problems with Linear Equations of one Variable

MA Lesson 11 Section 1.3. Solving Applied Problems with Linear Equations of one Variable MA 15200 Lesso 11 Sectio 1. I Solvig Applied Problems with Liear Equatios of oe Variable 1. After readig the problem, let a variable represet the ukow (or oe of the ukows). Represet ay other ukow usig

More information

When you click on Unit V in your course, you will see a TO DO LIST to assist you in starting your course.

When you click on Unit V in your course, you will see a TO DO LIST to assist you in starting your course. UNIT V STUDY GUIDE Percet Notatio Course Learig Outcomes for Uit V Upo completio of this uit, studets should be able to: 1. Write three kids of otatio for a percet. 2. Covert betwee percet otatio ad decimal

More information

ANNUAL ACTUAL INTEREST RATE CALCULATION FORMULA AND SAMPLES

ANNUAL ACTUAL INTEREST RATE CALCULATION FORMULA AND SAMPLES ANNUAL ACTUAL INTEREST RATE CALCULATION FORMULA AND SAMPLES Baks calculate aual actual iterest rate o grated credits based o article 13 of the law of RA About cosumer creditig. The aual actual iterest

More information

Solutions to Interest Theory Sample Questions

Solutions to Interest Theory Sample Questions to Iterest Theory Sample Questios Solutio 1 C Chapter 4, Iterest Rate Coversio After 7.5 years, the value of each accout is the same: 7.5 7.5 0.04 1001 100e 1.336 e l(1.336) 7.5 0.0396 7.5 Solutio E Chapter

More information

Fixed Income Securities

Fixed Income Securities Prof. Stefao Mazzotta Keesaw State Uiversity Fixed Icome Securities FIN4320. Fall 2006 Sample First Midterm Exam Last Name: First Name: Studet ID Number: Exam time is: 80 miutes. Total poits for this exam

More information

NPTEL DEPARTMENT OF INDUSTRIAL AND MANAGEMENT ENGINEERING IIT KANPUR QUANTITATIVE FINANCE END-TERM EXAMINATION (2015 JULY-AUG ONLINE COURSE)

NPTEL DEPARTMENT OF INDUSTRIAL AND MANAGEMENT ENGINEERING IIT KANPUR QUANTITATIVE FINANCE END-TERM EXAMINATION (2015 JULY-AUG ONLINE COURSE) NPTEL DEPARTMENT OF INDUSTRIAL AND MANAGEMENT ENGINEERING IIT KANPUR QUANTITATIVE FINANCE END-TERM EXAMINATION (2015 JULY-AUG ONLINE COURSE) READ THE INSTRUCTIONS VERY CAREFULLY 1) Time duratio is 2 hours

More information

Asset Valuation with known cash flows. Annuities and Perpetuities care loan, saving for retirement, mortgage

Asset Valuation with known cash flows. Annuities and Perpetuities care loan, saving for retirement, mortgage Asset Valuatio with kow cash flows Auities ad Perpetuities care loa, savig for retiremet, mortgage Simple Perpetuity A perpetuity is a stream of cash flows each of the amout of dollars, that are received

More information

The Time Value of Money in Financial Management

The Time Value of Money in Financial Management The Time Value of Moey i Fiacial Maagemet Muteau Irea Ovidius Uiversity of Costata irea.muteau@yahoo.com Bacula Mariaa Traia Theoretical High School, Costata baculamariaa@yahoo.com Abstract The Time Value

More information

43. A 000 par value 5-year bod with 8.0% semiaual coupos was bought to yield 7.5% covertible semiaually. Determie the amout of premium amortized i the 6 th coupo paymet. (A).00 (B).08 (C).5 (D).5 (E).34

More information

The self-assessment will test the following six major areas, relevant to studies in the Real Estate Division's credit-based courses:

The self-assessment will test the following six major areas, relevant to studies in the Real Estate Division's credit-based courses: Math Self-Assessmet This self-assessmet tool has bee created to assist studets review their ow math kowledge ad idetify areas where they may require more assistace. We hope that studets will complete this

More information

AY Term 2 Mock Examination

AY Term 2 Mock Examination AY 206-7 Term 2 Mock Examiatio Date / Start Time Course Group Istructor 24 March 207 / 2 PM to 3:00 PM QF302 Ivestmet ad Fiacial Data Aalysis G Christopher Tig INSTRUCTIONS TO STUDENTS. This mock examiatio

More information

Overlapping Generations

Overlapping Generations Eco. 53a all 996 C. Sims. troductio Overlappig Geeratios We wat to study how asset markets allow idividuals, motivated by the eed to provide icome for their retiremet years, to fiace capital accumulatio

More information

Driver s. 1st Gear: Determine your asset allocation strategy.

Driver s. 1st Gear: Determine your asset allocation strategy. Delaware North 401(k) PLAN The Driver s Guide The fial step o your road to erollig i the Delaware North 401(k) Pla. At this poit, you re ready to take the wheel ad set your 401(k) i motio. Now all that

More information

Fixed Income Securities

Fixed Income Securities Prof. Stefao Mazzotta Keesaw State Uiversity Fixed Icome Securities Sample First Midterm Exam Last Name: First Name: Studet ID Number: Exam time is: 80 miutes. Total poits for this exam is: 400 poits Prelimiaries

More information

living well in retirement Adjusting Your Annuity Income Your Payment Flexibilities

living well in retirement Adjusting Your Annuity Income Your Payment Flexibilities livig well i retiremet Adjustig Your Auity Icome Your Paymet Flexibilities what s iside 2 TIAA Traditioal auity Icome 4 TIAA ad CREF Variable Auity Icome 7 Choices for Adjustig Your Auity Icome 7 Auity

More information

A random variable is a variable whose value is a numerical outcome of a random phenomenon.

A random variable is a variable whose value is a numerical outcome of a random phenomenon. The Practice of Statistics, d ed ates, Moore, ad Stares Itroductio We are ofte more iterested i the umber of times a give outcome ca occur tha i the possible outcomes themselves For example, if we toss

More information

1 Random Variables and Key Statistics

1 Random Variables and Key Statistics Review of Statistics 1 Radom Variables ad Key Statistics Radom Variable: A radom variable is a variable that takes o differet umerical values from a sample space determied by chace (probability distributio,

More information

Confidence Intervals. CI for a population mean (σ is known and n > 30 or the variable is normally distributed in the.

Confidence Intervals. CI for a population mean (σ is known and n > 30 or the variable is normally distributed in the. Cofidece Itervals A cofidece iterval is a iterval whose purpose is to estimate a parameter (a umber that could, i theory, be calculated from the populatio, if measuremets were available for the whole populatio).

More information

The Time Value of Money

The Time Value of Money Part 2 FOF12e_C03.qxd 8/13/04 3:39 PM Page 39 Valuatio 3 The Time Value of Moey Cotets Objectives The Iterest Rate After studyig Chapter 3, you should be able to: Simple Iterest Compoud Iterest Uderstad

More information

Lecture 2. Tuesday Feb 3 rd. Time Value of Money 1

Lecture 2. Tuesday Feb 3 rd. Time Value of Money 1 Lecture 2. Tuesday Feb 3 rd Time Value of Moey 1 What is Moey? Moey is a promise A Eglish Bakote says: I promise to pay the Bearer o demad the sum of twety pouds Ad it is siged by the Chief Cashier of

More information

2.6 Rational Functions and Their Graphs

2.6 Rational Functions and Their Graphs .6 Ratioal Fuctios ad Their Graphs Sectio.6 Notes Page Ratioal Fuctio: a fuctio with a variable i the deoiator. To fid the y-itercept for a ratioal fuctio, put i a zero for. To fid the -itercept for a

More information

2013/4/9. Topics Covered. Principles of Corporate Finance. Time Value of Money. Time Value of Money. Future Value

2013/4/9. Topics Covered. Principles of Corporate Finance. Time Value of Money. Time Value of Money. Future Value 3/4/9 Priciples of orporate Fiace By Zhag Xiaorog : How to alculate s Topics overed ad Future Value Net NPV Rule ad IRR Rule Opportuity ost of apital Valuig Log-Lived Assets PV alculatio Short uts ompoud

More information

Institute of Actuaries of India Subject CT5 General Insurance, Life and Health Contingencies

Institute of Actuaries of India Subject CT5 General Insurance, Life and Health Contingencies Istitute of Actuaries of Idia Subject CT5 Geeral Isurace, Life ad Health Cotigecies For 2017 Examiatios Aim The aim of the Cotigecies subject is to provide a groudig i the mathematical techiques which

More information

Current Year Income Assessment Form 2017/18

Current Year Income Assessment Form 2017/18 Curret Year Icome Assessmet Form 2017/18 Persoal details Your Customer Referece Number Your Customer Referece Number Name Name Date of birth Address / / Date of birth / / Address Postcode Postcode If you

More information

CAPITAL PROJECT SCREENING AND SELECTION

CAPITAL PROJECT SCREENING AND SELECTION CAPITAL PROJECT SCREEIG AD SELECTIO Before studyig the three measures of ivestmet attractiveess, we will review a simple method that is commoly used to scree capital ivestmets. Oe of the primary cocers

More information

ad covexity Defie Macaulay duratio D Mod = r 1 = ( CF i i k (1 + r k) i ) (1.) (1 + r k) C = ( r ) = 1 ( CF i i(i + 1) (1 + r k) i+ k ) ( ( i k ) CF i

ad covexity Defie Macaulay duratio D Mod = r 1 = ( CF i i k (1 + r k) i ) (1.) (1 + r k) C = ( r ) = 1 ( CF i i(i + 1) (1 + r k) i+ k ) ( ( i k ) CF i Fixed Icome Basics Cotets Duratio ad Covexity Bod Duratios ar Rate, Spot Rate, ad Forward Rate Flat Forward Iterpolatio Forward rice/yield, Carry, Roll-Dow Example Duratio ad Covexity For a series of cash

More information

SOCIETY OF ACTUARIES FINANCIAL MATHEMATICS EXAM FM SAMPLE SOLUTIONS

SOCIETY OF ACTUARIES FINANCIAL MATHEMATICS EXAM FM SAMPLE SOLUTIONS SOCIETY OF ACTUARIES EXAM FM FINANCIAL MATHEMATICS EXAM FM SAMPLE SOLUTIONS This set of sample questios icludes those published o the iterest theory topic for use with previous versios of this examiatio.

More information

ACTUARIAL RESEARCH CLEARING HOUSE 1990 VOL. 2 INTEREST, AMORTIZATION AND SIMPLICITY. by Thomas M. Zavist, A.S.A.

ACTUARIAL RESEARCH CLEARING HOUSE 1990 VOL. 2 INTEREST, AMORTIZATION AND SIMPLICITY. by Thomas M. Zavist, A.S.A. ACTUARIAL RESEARCH CLEARING HOUSE 1990 VOL. INTEREST, AMORTIZATION AND SIMPLICITY by Thomas M. Zavist, A.S.A. 37 Iterest m Amortizatio ad Simplicity Cosider simple iterest for a momet. Suppose you have

More information

Subject CT5 Contingencies Core Technical. Syllabus. for the 2011 Examinations. The Faculty of Actuaries and Institute of Actuaries.

Subject CT5 Contingencies Core Technical. Syllabus. for the 2011 Examinations. The Faculty of Actuaries and Institute of Actuaries. Subject CT5 Cotigecies Core Techical Syllabus for the 2011 Examiatios 1 Jue 2010 The Faculty of Actuaries ad Istitute of Actuaries Aim The aim of the Cotigecies subject is to provide a groudig i the mathematical

More information

Estimating Proportions with Confidence

Estimating Proportions with Confidence Aoucemets: Discussio today is review for midterm, o credit. You may atted more tha oe discussio sectio. Brig sheets of otes ad calculator to midterm. We will provide Scatro form. Homework: (Due Wed Chapter

More information

Lecture 16 Investment, Time, and Risk (Basic issues in Finance)

Lecture 16 Investment, Time, and Risk (Basic issues in Finance) Lecture 16 Ivestmet, Time, ad Risk (Basic issues i Fiace) 1. Itertemporal Ivestmet Decisios: The Importace o Time ad Discoutig 1) Time as oe o the most importat actors aectig irm s ivestmet decisios: A

More information

Bond Valuation. Structure of fixed income securities. Coupon Bonds. The U.S. government issues bonds

Bond Valuation. Structure of fixed income securities. Coupon Bonds. The U.S. government issues bonds Structure of fixed icome securities Bod Valuatio The Structure of fixed icome securities Price & ield to maturit (tm) Term structure of iterest rates Treasur STRIPS No-arbitrage pricig of coupo bods A

More information

Chapter 11 Appendices: Review of Topics from Foundations in Finance and Tables

Chapter 11 Appendices: Review of Topics from Foundations in Finance and Tables Chapter 11 Appedices: Review of Topics from Foudatios i Fiace ad Tables A: INTRODUCTION The expressio Time is moey certaily applies i fiace. People ad istitutios are impatiet; they wat moey ow ad are geerally

More information

Twitter: @Owe134866 www.mathsfreeresourcelibrary.com Prior Kowledge Check 1) State whether each variable is qualitative or quatitative: a) Car colour Qualitative b) Miles travelled by a cyclist c) Favourite

More information

T4032-MB, Payroll Deductions Tables CPP, EI, and income tax deductions Manitoba Effective January 1, 2016

T4032-MB, Payroll Deductions Tables CPP, EI, and income tax deductions Manitoba Effective January 1, 2016 T4032-MB, Payroll Deductios Tables CPP, EI, ad icome tax deductios Maitoba Effective Jauary 1, 2016 T4032-MB What s ew as of Jauary 1, 2016 The major chages made to this guide sice the last editio are

More information

ENGINEERING ECONOMICS

ENGINEERING ECONOMICS ENGINEERING ECONOMICS Ref. Grat, Ireso & Leaveworth, "Priciples of Egieerig Ecoomy'','- Roald Press, 6th ed., New York, 1976. INTRODUCTION Choice Amogst Alteratives 1) Why do it at all? 2) Why do it ow?

More information

Dr. Maddah ENMG 602 Intro to Financial Eng g 01/18/10. Fixed-Income Securities (2) (Chapter 3, Luenberger)

Dr. Maddah ENMG 602 Intro to Financial Eng g 01/18/10. Fixed-Income Securities (2) (Chapter 3, Luenberger) Dr Maddah ENMG 60 Itro to Fiacial Eg g 0/8/0 Fixed-Icome Securities () (Chapter 3 Lueberger) Other yield measures Curret yield is the ratio of aual coupo paymet to price C CY = For callable bods yield

More information

AccumUL Plus. United of Omaha Life Insurance Company A Mutual of Omaha Company. product guide

AccumUL Plus. United of Omaha Life Insurance Company A Mutual of Omaha Company. product guide Uited of Omaha Life Isurace Compay A Mutual of Omaha Compay AccumUL Plus product guide L7864_1211 Product base pla features, provisios ad riders may ot be approved i all states. For producer use oly. Not

More information

Financial Math Lesson #2

Financial Math Lesson #2 Compoud Iteest Fiacial Math Lesso #2 Compoud iteest is a method of calculatig iteest i which the iteest is added to the picipal each peiod so that the picipal cotiues to gow thoughout the life of the loa

More information

BASIC STATISTICS ECOE 1323

BASIC STATISTICS ECOE 1323 BASIC STATISTICS ECOE 33 SPRING 007 FINAL EXAM NAME: ID NUMBER: INSTRUCTIONS:. Write your ame ad studet ID.. You have hours 3. This eam must be your ow work etirely. You caot talk to or share iformatio

More information

T4032-ON, Payroll Deductions Tables CPP, EI, and income tax deductions Ontario Effective January 1, 2016

T4032-ON, Payroll Deductions Tables CPP, EI, and income tax deductions Ontario Effective January 1, 2016 T4032-ON, Payroll Deductios Tables CPP, EI, ad icome tax deductios Otario Effective Jauary 1, 2016 T4032-ON What s ew as of Jauary 1, 2016 The major chages made to this guide sice the last editio are outlied.

More information

Introduction to Financial Derivatives

Introduction to Financial Derivatives 550.444 Itroductio to Fiacial Derivatives Determiig Prices for Forwards ad Futures Week of October 1, 01 Where we are Last week: Itroductio to Iterest Rates, Future Value, Preset Value ad FRAs (Chapter

More information

T4032-BC, Payroll Deductions Tables CPP, EI, and income tax deductions British Columbia Effective January 1, 2016

T4032-BC, Payroll Deductions Tables CPP, EI, and income tax deductions British Columbia Effective January 1, 2016 T4032-BC, Payroll Deductios Tables CPP, EI, ad icome tax deductios British Columbia Effective Jauary 1, 2016 T4032-BC What s ew as of Jauary 1, 2016 The major chages made to this guide, sice the last editio,

More information

ISBN Copyright 2015 The Continental Press, Inc.

ISBN Copyright 2015 The Continental Press, Inc. TABLE OF CONTENTS Itroductio 3 Format of Books 4 Suggestios for Use 7 Aotated Aswer Key ad Extesio Activities 9 Reproducible Tool Set 183 ISBN 978-0-8454-7897-4 Copyright 2015 The Cotietal Press, Ic. Exceptig

More information

1. Suppose X is a variable that follows the normal distribution with known standard deviation σ = 0.3 but unknown mean µ.

1. Suppose X is a variable that follows the normal distribution with known standard deviation σ = 0.3 but unknown mean µ. Chapter 9 Exercises Suppose X is a variable that follows the ormal distributio with kow stadard deviatio σ = 03 but ukow mea µ (a) Costruct a 95% cofidece iterval for µ if a radom sample of = 6 observatios

More information

B = A x z

B = A x z 114 Block 3 Erdeky == Begi 6.3 ============================================================== 1 / 8 / 2008 1 Correspodig Areas uder a ormal curve ad the stadard ormal curve are equal. Below: Area B = Area

More information

physicsandmathstutor.com

physicsandmathstutor.com physicsadmathstutor.com 9. (a) A geometric series has first term a ad commo ratio r. Prove that the sum of the first terms of the series is a(1 r ). 1 r (4) Mr. Kig will be paid a salary of 35 000 i the

More information

Basic formula for confidence intervals. Formulas for estimating population variance Normal Uniform Proportion

Basic formula for confidence intervals. Formulas for estimating population variance Normal Uniform Proportion Basic formula for the Chi-square test (Observed - Expected ) Expected Basic formula for cofidece itervals sˆ x ± Z ' Sample size adjustmet for fiite populatio (N * ) (N + - 1) Formulas for estimatig populatio

More information

Chapter 2 Demand and Supply Analysis

Chapter 2 Demand and Supply Analysis Chapter 2 Demad ad Supply Aalysis Outlie 1. Competitive Markets Defiitio Assumptios of the model 2. The Market Demad Curve 3. The Market Supply Curve 4. Competitive Market Equilibrium 5. Elasticity 2 Mothly

More information

Math 124: Lecture for Week 10 of 17

Math 124: Lecture for Week 10 of 17 What we will do toight 1 Lecture for of 17 David Meredith Departmet of Mathematics Sa Fracisco State Uiversity 2 3 4 April 8, 2008 5 6 II Take the midterm. At the ed aswer the followig questio: To be revealed

More information

Summary of Benefits RRD

Summary of Benefits RRD Summary of Beefits RRD All Eligible Employees Basic Term Life, Optioal Term Life, Optioal Depedet Term Life ad Optioal Accidetal Death & Dismembermet Issued by The Prudetial Isurace Compay of America Effective:

More information

FINM6900 Finance Theory How Is Asymmetric Information Reflected in Asset Prices?

FINM6900 Finance Theory How Is Asymmetric Information Reflected in Asset Prices? FINM6900 Fiace Theory How Is Asymmetric Iformatio Reflected i Asset Prices? February 3, 2012 Referece S. Grossma, O the Efficiecy of Competitive Stock Markets where Traders Have Diverse iformatio, Joural

More information

CD Appendix AC Index Numbers

CD Appendix AC Index Numbers CD Appedix AC Idex Numbers I Chapter 20, we preseted a variety of techiques for aalyzig ad forecastig time series. This appedix is devoted to the simpler task of developig descriptive measuremets of the

More information

Methodology on setting the booking prices Project Development and expansion of Bulgartransgaz EAD gas transmission system

Methodology on setting the booking prices Project Development and expansion of Bulgartransgaz EAD gas transmission system Methodology o settig the bookig prices Project Developmet ad expasio of Bulgartrasgaz EAD gas trasmissio system Art.1. The preset Methodology determies the coditios, order, major requiremets ad model of

More information

TIME VALUE OF MONEY 6.1 TIME VALUE OF MONEY

TIME VALUE OF MONEY 6.1 TIME VALUE OF MONEY C h a p t e r TIME VALUE O MONEY 6. TIME VALUE O MONEY The idividual s preferece for possessio of give amout of cash ow, rather tha the same amout at some future time, is called Time preferece for moey.

More information

Mark to Market Procedures (06, 2017)

Mark to Market Procedures (06, 2017) Mark to Market Procedures (06, 207) Risk Maagemet Baco Sumitomo Mitsui Brasileiro S.A CONTENTS SCOPE 4 2 GUIDELINES 4 3 ORGANIZATION 5 4 QUOTES 5 4. Closig Quotes 5 4.2 Opeig Quotes 5 5 MARKET DATA 6 5.

More information

CHAPTER 8 Estimating with Confidence

CHAPTER 8 Estimating with Confidence CHAPTER 8 Estimatig with Cofidece 8.2 Estimatig a Populatio Proportio The Practice of Statistics, 5th Editio Stares, Tabor, Yates, Moore Bedford Freema Worth Publishers Estimatig a Populatio Proportio

More information

TUSCULUM COLLEGE. Group Number:

TUSCULUM COLLEGE. Group Number: The Guardia Life Isurace Compay of America, New York, NY 10004 Group Number: 00498351 TUSCULUM COLLEGE Here you'll fid iformatio about your followig employee beefit(s). Be sure to review the eclosed -

More information

ST 305: Exam 2 Fall 2014

ST 305: Exam 2 Fall 2014 ST 305: Exam Fall 014 By hadig i this completed exam, I state that I have either give or received assistace from aother perso durig the exam period. I have used o resources other tha the exam itself ad

More information

Using Home Equity as a Retirement Asset: Reverse Mortgage Basics

Using Home Equity as a Retirement Asset: Reverse Mortgage Basics Usig Home Equity as a Retiremet Asset: Reverse Mortgage Basics Thak you for explorig your reverse mortgage optios with . We ve created this itroductory guide to help

More information

1 Basic Growth Models

1 Basic Growth Models UCLA Aderso MGMT37B: Fudametals i Fiace Fall 015) Week #1 rofessor Eduardo Schwartz November 9, 015 Hadout writte by Sheje Hshieh 1 Basic Growth Models 1.1 Cotiuous Compoudig roof: lim 1 + i m = expi)

More information