## MATH 301 - ECO 351 THEORY OF INTEREST Fall 2005

 INSTRUCTOR: Prof. KARIN REINHOLD Office: ES 128 C (previously 128A) Phone: 442-4641 e-mail: reinhold@math.albany.edu Office Hours: T Th 1:10 - 2:00, M, W 10-11, or by appointment. TEXT: Mathematics of Interest Rates and Finance by Guthrie & Lemon Pearson, Prentice Hall CALCULATOR: a financial calculator is recommended but it is optional. Scientific calculators are acepted. If you are planning on becoming an actuary, buy one that is recommended by the Society of Actuaries: see its web page www.soa.org.

### Handouts

• Exam 4
• Other annuities: notes, and problem set. Solution to prob 7
• Amortization and Sinking Funds: notes, and problem set.
• ### Course description:

T & Th 11:40-1:05
This course will cover the basics of theory of interest: simple and compound interest, annuities, yield rates, bonds and securities and practical applications.

This course is a preparation for part of the Actuarial Exam Course 2. As a prerequisite for this course you should be familiar with the geometric sum (from Calculus II), integrating functions, specially the logarithm and be familiar with the properties of the logarithm and exponential functions (from Calculus I).

There is a lot of material to cover for the exam. Most of the concepts are inter-related and based on the simple ideas governing compound interest. I will try to make it as easy for you as possible, helping you with summaries. The hard part of the course is getting use to do word problems with several steps and remembering formulas. We will discuss as many problems as time allows.

The grade in the course will be based on four exams (20% of grade each), weekly online quizzes (20% of grade) plus class participation and home assignments as extra credit. To pass the course you need to obtain a total average of 50\% or more, must not fail more than one exam.

It is your responsibility to be aware of the dates of the exams and the content and due date of assignments. The information is listed in the course page in WebCT. If you miss a class, it is your responsibility to be aware of the topics discussed during that class, the assigned homework and the and the possibly given assignment.

There is no reason to miss an exam other than getting sick (bring note from doctor), being on a team that has a game at the same time an exam is given (bring a note from your coach), or a death or serious illness in your family (bring a note from your family). In the event you can not attend an exam, you must notify me in advance, otherwise your grade for that exam will be 0. You can contact me by phone (leave a message if I'm not in), stop by my office (leave a note if I'm not in) or send me an e-mail.

EXAM SCHEDULE:
Exam 1: Sept 20 Chapters: Chapters 1 & 2
Exam 2: Oct 20 Chapter: 3 & 4 & 5
Exam 3: Nov 10 Chapters: 6 & 7
Exam 4: Dec 8 Chapters: 8 & 9

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