Registry

Module Specifications

Archived Version 2009 - 2010

Module Title	Mathematics of Finance:An Introduction
Module Code	MS216
School	School of Mathematical Sciences
Online Module Resources
Module Co-ordinator	Prof John Carroll	Office Number	X139
Level	2	Credit Rating	5
Pre-requisite	None
Co-requisite	None

Module Aims

To introduce students to the mathematics of finance.
To provide students with a grounding in elements of fianancial mathematics and its related applications.

Learning Outcomes

A good understanding of interest rates and annuities.
The ability to evaluate simple loans and mortgages.
The ability to work with various forms of interest and discount rates and the basic compound interest functions in order to value cash flows.

Indicative Time Allowances
	Hours
Lectures	24
Tutorials	11
Laboratories	0
Seminars	0
Independent Learning Time	40

Total	75
Placements
Assignments

NOTE

Assume that a 5 credit module load represents approximately 75 hours' work, which includes all teaching, in-course assignments, laboratory work or other specialised training and an estimated private learning time associated with the module.

Indicative Syllabus

Indicative Lecture hours given in < > below:

< 4 > Interest Rates: nominal rates of interest and discount; constant force of interest; simple equations of value; yield. [CT1 - (i) to (iii)]

< 8 > Basic Compound Interest functions: level, deferred and increasing annuities; present and future values; equations of value and yield. [CT1 - (v) to (vii)]

< 6 > Loans & Annuities Payable pthly: Loan schedules; annuities payable phtly; present values and accumulations; APR. [CT1 - (vi) & (viii)]

< 6 > Discounted Cash Flow: net cash flows; comparison of investment projects; net present values; yields; discounted payback period; real and money interest rates. [CT1 - (iv) & (ix)]

Assessment
Continuous Assessment	20%	Examination Weight	80%

Indicative Reading List

ActEd Study Materials: Subject CT1 Course Notes, The Actuarial Education Com- pany (on behalf of the Instutute of Actuaries and the Faculty of Actuaries). (Essential for Actuarial Mathematics students).
An Introduction to the Mathematics of Finance, JJ McCutcheon and W E Scott, Published by the Institute of Actuaries & the Faculty of Actuaries, Butterworth- Heinemann 1999. ISBN 0 7506 0092.

Programme or List of Programmes on which this module will be delivered: