An introduction to actuarial cash flow models. Simple,
compound, and effective interest functions are analyzed and
used in the calculation of present value and future values of
various types of annuities as well as more complex cash flow
streams.
Athena Title
Actuarial Financial Math
Prerequisite
MATH 2260 or MATH 2260E or MATH 2260H or permission of department
Semester Course Offered
Offered every year.
Grading System
A - F (Traditional)
Student Learning Outcomes
By the end of this course, students will be able to teach actuarial cash flow models, which constitute the theoretical foundation of actuarial science.
By the end of this course, students will be able to describe different annuities and their cash flows.
By the end of this course, students will be able to provide an understanding of the time value of money among different types of annuities as well as more complex cash flow streams.
By the end of this course, students will develop analytical problem solving skills to solve complex problems from first principles rather than memorization.
By the end of this course, students will be able to incorporate examples and problems both in class and in
homework.
Give an opportunity for students to work together in groups to complete homework. This will allow students to learn how to work together in a team and how to effectively communicate quantitative ideas.
Cover most of the material and prepare students for Exam 2 of the Casualty Actuarial Society and Exam FM of the Society of Actuaries.
Topical Outline
The measurement of interest
Solution of problems in interest
Basic annuities
More general annuities
Amortization schedules and sinking funds
Generalized cash flow models
Yield rates
More advanced financial analysis
The term structure of interest rates
Risk Management applications
Overview of financial instruments and their cash flows
