Mathematical Interest Theory
eBook - PDF

Mathematical Interest Theory

Third Edition

  1. English
  2. PDF
  3. Available on iOS & Android
eBook - PDF

Mathematical Interest Theory

Third Edition

About this book

Mathematical Interest Theory provides an introduction to how investments grow over time. This is done in a mathematically precise manner. The emphasis is on practical applications that give the reader a concrete understanding of why the various relationships should be true. Among the modern financial topics introduced are: arbitrage, options, futures, and swaps. Mathematical Interest Theory is written for anyone who has a strong high-school algebra background and is interested in being an informed borrower or investor. The book is suitable for a mid-level or upper-level undergraduate course or a beginning graduate course.The content of the book, along with an understanding of probability, will provide a solid foundation for readers embarking on actuarial careers. The text has been suggested by the Society of Actuaries for people preparing for the Financial Mathematics exam. To that end, Mathematical Interest Theory includes more than 260 carefully worked examples. There are over 475 problems, and numerical answers are included in an appendix. A companion student solution manual has detailed solutions to the odd-numbered problems. Most of the examples involve computation, and detailed instruction is provided on how to use the Texas Instruments BA II Plus and BA II Plus Professional calculators to efficiently solve the problems. This Third Edition updates the previous edition to cover the material in the SOA study notes FM-24-17, FM-25-17, and FM-26-17.

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Yes, you can access Mathematical Interest Theory by Leslie Jane Federer Vaaler,Shinko Kojima Harper,James W. Daniel in PDF and/or ePUB format, as well as other popular books in Mathematics & Mathematical Analysis. We have over one million books available in our catalogue for you to explore.
Section
1.3
Accumulation
and
amount
functions
13
Solution
If
interest
is
earned
continuously
using
the
given
linear
relation-
ship,
the
graph
of
A
1
,
000
(
t
)
is
a
line
segment
with
slope
250.
A
1
,
000
(
t
)
t
If
interest
is
only
paid
at
the
end
of
each
year,
the
graph
of
A
1
,
000
(
t
)
is
as
follows:
A
1
,
000
(
t
)
t
EXAMPLE
1.3.3
Problem:
Suppose
that
time
is
measured
in
years
and
an
investment
fund
grows
according
to
a
(
t
)
=
(1
.
2)
t
for
0
≤
t
≤
5.
Then
the
investment
fund
grows
at
a
constant
rate
of
20%
per
year.
(In
Section
1.5,
we
will
call
a
(
t
)
a
compound
interest
accumulation
function
with
annual
effective
interest
rate
i
=
.
2.)
Graph
the
accumulation
function
a
(
t
).

Table of contents

  1. Cover
  2. Title page
  3. Preface
  4. 0. An introduction to the Texas Instruments BA II Plus
  5. 1. The growth of money
  6. 2. Equations of value and yield rates
  7. 3. Annuities (annuities certain)
  8. 4. Annuities with different payment and conversion periods
  9. 5. Loan repayment
  10. 6. Bonds
  11. 7. Stocks and financial markets
  12. 8. Arbitrage, term structure of interest rates, and derivatives
  13. 9. Interest rate sensitivity
  14. 10. Determinants of interest rates
  15. APPENDICES
  16. A. Some useful formulas
  17. B. Answers to end of chapter problems
  18. Bibliography
  19. Index
  20. About the Authors
  21. Back Cover