Mathematics of Finance (2cr)

Objectives (course unit)

This straightforward exercise based course provides the students with information and hands-on skills of selected fundamental parts of business mathematics.

The time value of money theory forms the foundation of the course. The predetermined main objectives for the students are to learn to apply the theory, solve problems and communicate the problems, their solutions as well as the achieved new understanding effectively.

After completing the course, the students will be able to:
• Identify opportunities for mathematical problem solving involved with the time value of money concept and theory.
• Find out the present and future values of invested money in different cases of compounding.
• Compare interest rates, returns on investments and cash flows utilizing the effective rate, present value and net present value concepts.
• Find out the present and future value as well as the periodic payment of an ordinary annuity.
• Prepare simple loan amortization schedules and calculate amortizations in MS Excel.
• Communicate mathematical problems, their solutions and interpretations briefly and informatively.

Content (course unit)

• What are the simple interest, growth percentage and sum of sequence all about?
• How are various compound interest and effective rate calculations solved?
• How are the present value and net present value (NPV) determined?
• What different types of annuities are there, and how are the periodic payment and the present and future values of an ordinary annuity determined?
• How can loan amortization schedules be prepared and loans become amortized?

Exam schedules

Around Dec 8, 2016. Maybe at TAMK exam aquarium.

Assessment methods and criteria

The overall course performance is evaluated using:
- a 50 % weight on performing some selected exercises acceptably during the course, and
- a 50 % weight on the grade of final exam performance.
For an acceptable overall course grade, the student needs to pass the exam.

Assessment scale

0-5

Teaching methods

Instructor's brief introductions of the themes, theories, methods and formulas. Mathematical problem solving both under supervision in the class and individually and/or as pairwork between the classes. Model answers and discussion based on them finish each main theme of the course.

Learning materials

(New learning material to be published to the students when the course begins the next time in autumn 2016.)

Student workload

Max. 52-54h, during the Oct 24 - Dec 8, 2016 period.

Content scheduling

(See the Contents and Objectives of the course categories.)

Completion alternatives

-

Practical training and working life cooperation

-

International connections

-

Further information

Mr Pasi Kuusijärvi, M.Sc. (Econ. and Bus. Adm.)
Senior Lecturer, Accounting and Financial Management
Tampere University of Applied Sciences
+358 40 846 3052
pasi.kuusijarvi@tamk.fi

Assessment criteria - fail (0) (Not in use, Look at the Assessment criteria above)

Exam failed.

Assessment criteria - satisfactory (1-2) (Not in use, Look at the Assessment criteria above)

Student has many incorrect answers as end results of his/her calculations. His/her solutions, anyway, mostly prove that he/she has, anyway, mostly understood the theories, methods and practices of the course contents.

Assessment criteria - good (3-4) (Not in use, Look at the Assessment criteria above)

Student has mostly correct answers as end results of his/her calculations. His/her solutions prove that he/she has also understood the theories, methods and practices of the course contents. Student's proven skills of also communicating and sharing his/her knowledge of the course contents during the course help in achieving the very good grade of 4, instead of the good 3.

Assessment criteria - excellent (5) (Not in use, Look at the Assessment criteria above)

Student has in practice only correct answers as end results of his/her calculations. His/her solutions prove that he/she has also understood the theories, methods and practices of the course contents very well. Student's highly desired habit of also communicating and sharing his/her knowledge of the course contents together with the other course participants is an additional big plus in his/her also otherwise excellent performance.