Winter Term, 2018Mathematics 170 B – Introduction to Mathematics for FinanceDepartment of Mathematics, Faculty of Science, Wilfrid Laurier UniversityInstructor:Mr. Andrew Kabbes, E-Mail:[email protected], Office:LH3046 (Lazaridis Hall), Telephone:ext. 4519Office Hours:As announced in class, or by appointment.Course InformationCalendar Description:An introduction to the theory of interest. Mathematical models and their analysis for problems involving fixed interest rates. Simple and compound interest. Cash flows, annuities, amortization and sinking funds. (Zero-)coupon bonds.Prerequisites: 12U Advanced Functions, or equivalent, or permission of the department.Lectures Time and Location:Tuesdays and Thursdays, from 11:30 a.m. - 12:50 p.m. in LH1001.Learning OutcomesBy the end of the course, students will be able to do the following:•Calculate the present and future values of a single sum of money.•Set up an equation of value for given cash flows and solve it to find a payment or a sequence of payments. •Calculate the present and future values of annuities such as loans, risk-free investments, mortgages, etc.•Determine the term of an annuity along with the value of the final payment.•Create amortization schedules for accumulation of funds and repayment of debts.•Determine the periodic payment, outstanding balance, and number of payments using the amortization method.•Compute the purchase price of various types of bonds and create bond schedules.•Calculate the rate of return on an investment (e.g., the yield rate of a coupon bond).Students will be assessed through laboratory assignments and quizzes, a midterm test and a cumulative final exam.Course Tools and Learning MaterialsRequired Textbook:Brown, R.L., Kopp, S., and Zima, P. (2015) Mathematics of Finance, 8thCdn. Edition. Homework: A list of homework problems will be suggested on a regular basis. These assigned problems are not to be handed in. However, working on these problems is essential to successfully completing the course. You should attempt all recommended problems as soon as possible.Course Websites:Material related to the course, including announcements, homework, handouts, assignments, test information, labs, etc will be posted on the MA170 MyLearningSpacesite.Calculators: Students may use a non-programmable, non-graphing calculator on course tests and the final examination.1
EvaluationA final mark out of 100 will be calculated as follows:WeBWorK Homework Assignments(1 each week)10 %Laboratories(completed during each lab)25 %Midterm Test(Thursday, Feb. 15, 2018 during lecture and lab time)25 %Final Examination(Apr. 7 - 25, 2018; exact date, time and location to be announced)40 %Total = 100 %Students must achieve a score of at least 40% of the marks available on the final examination to be eligible to pass the course. The final mark will be reported as a letter grade in accordance with the conversion table of the 2017/2018 Undergraduate Calendar.