UNIVERSITY OF WATERLOO
DEPARTMENT OF STATISTICS AND ACTUARIAL SCIENCE
MID-TERM TEST #2
(Section 3.4 to 6.5)
ACTUARIAL SCIENCE 221, Spring 2002
July 16, 2002
INSTRUCTOR: Cho-Jieh Chen
I.D.:
Name:
QUESTION
AVAILABLE
1a
5
1b
5
1c
5
2a
5
2b
5
2c
5
3a
5
3b
5
3
UNIVERSITY OF WATERLOO DEPARTMENT OF STATISTICS AND ACTUARIAL SCIENCE MID-TERM TEST #2 (Section 3.4 to 6.5)
ACTUARIAL SCIENCE 221, Spring 2002 July 16, 2002
INSTRUCTOR: Cho-Jieh Chen
I.D.:
Name:
QUESTION 1a 1b 1c 2a 2b 2c 3a 3b 3c 3d 3e 3f EXAM TOTAL
AVAI
Additional Formulas
Sum of geometric series:
Sn = t1*
1
1
or Sn = t1*
Sum of infinite geometric series where r < 1:
Simple interest: I
= Prt; S = P * (1+rt)
S=
t1
1
1
1
ACTSC 221
Review for Midterm
The midterm will cover the material in Chapters 1-4 in the text. Only material covered in lectures will be tested.
Be aware of simple interest and how it differs from compound interest
Know how to calculate accumulated and dis
ACTSC 221
Review for Final Exam
Be aware of simple interest and how it differs from compound interest
Know how to calculate accumulated and discounted value for a single payment using a variety of rates and
compounding periods (including continuous compou
ACTSC 221 Final Review Problems
1. Construct a bond schedule up to and including the third payment for a $5,000,000 par value bond with a
coupon of j2 = 8%, priced to yield j2 = 9%, maturing in 8 years (ends at 4,757,928.69)
Note that could be told: 5,000
ACTSC 221 Review Problems Midterm
What is the value on June 1, 2011 of $1,000 due on Dec. 1, 2006 and $800 due on Dec. 1, 2016 at j2 = 6.38%
($1,892.93)
How much interest is earned on a $100 investment between years 5 and 10 at j2 = 7%. ($57.92)
Joe buys
ACTSC 221
Quiz #1
SOLUTIONS
Note: Numerical answers are rounded to 2 decimal places.
1. Joe invests $1,000 for 4 years at an interest rate of 10% compounded annually. If Sam
invests the same amount also for 4 years, at what rate of simple interest does Sa