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 DEPARTMENT OF MATHEMATICS
 AND STATISTICS
1999 - 2000 MINICALENDAR
 Faculty of Arts
 Faculty of Pure and Applied Science

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AS/AK/ MATH 2580 6.0

Mathematics of Investment and Actuarial Science

      Theory of interest; annuities certain; amortization and sinking funds; evaluation of bonds and other investments; depreciation, depletion and capital cost; insurance, including mortality tables, principles of life annuities, premiums and reserves.
      The first four-fifths of the course deal with most of the above topics, with applications to simple and general annuities, perpetuities, loan payments, capital budgeting, and internal rates of return. In the last few weeks of the course, the theory of interest is applied to life annuities and life insurance.
      Students will use EXCEL, a spreadsheet available in the micro-computer laboratory in the Steacie building. This spreadsheet operates on both the Macintosh and IBM-compatible platforms. EXCEL will be used to simplify and illuminate equation-solving, amortization of loans and mortgages, bond schedules, depreciation tables, and mortality tables. No previous computer experience is assumed. With the help of notes and class instruction students will be introduced to the spreadsheet and to its use in mathematics of finance. Students will receive individual computer accounts on the ACADLABS server. Each student will also need a hand-held calculator which has power and logarithm functions. Specifically, it must be able, given values of x and y, to compute xy.
      The course should be especially interesting to students of business and economics. The emphasis will be on practical problems. Although the mathematical background required is minimal, it is preferred that students will have taken one other mathematics course at university before taking this one.
      The required text for the course will be P. Zima and R. Brown, Mathematics of Finance (4th Ed.), McGraw-Hill Ryerson Ltd. 1993. The manuals for EXCEL will be on reserve at the desk in Steacie Library.
      Students who wish a more advanced treatment of the material should not take this course, but enrol instead in MATH2280 3.0. In particular, this includes:
  • Honours Mathematics for Commerce students in the Actuarial Stream. MATH2280 3.0 is a required course for this programme.
  • students who are contemplating a career in the actuarial profession. They should take MATH 2280 3.0, followed by MATH 3280 6.0.


      In past years the final grade has been based on class testing (60%) and a final examination (40%). There will likely be some spreadsheet-based homework assignments.

Prerequisite:One full university mathematics course.
Exclusions:AS/MATH 1581 3.0, AS/SC/MATH 2280 3.0, AS/MATH 2581 3.0.

Fall: Richard L.W. Brown* Section A: Course Page
  Richard L.W. Brown* Section B: Course Page
*Coordinator

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