Financial Mathematics
Instructor: Бојан Башкот, PhD, Associate Professor
The main objective of this subject is to transfer knowledge to students in relation to the time value of money calculations of simple and compound interests. As part of the teaching process, students will learn about the elements of the final and initial values of the individual amounts of money, accounts of periodic deposits, account of periodic withdrawals, amortization and conversion of the loan, the elements of the theory of the loan rate and life insurance models based on single and recurring premiums.
| Code : | О14ФМА |
|---|---|
| Status: | C |
| Semestar: | 4th |
| Number of classes per week: | 4+2 |
| ЕECTS: | 7 |
| Teachers: |
Бојан Башкот,
PhD Associate Professor Андреј Шева, MSc Assistant |
| Prerequisites: | Математика за економисте |
| Learning Outcomes (gained knowledge): | After mastering the above calculations, future graduate economists will have a theoretical basis for solving similar problems in practice: in banks, corporations, insurance companies and other financial institutions. |
| Subject Contents: | Chain and percentage account. Account of separation and mixing. Calculation of the interest. Lombard and current account. Calculation of consumer loans. Discounting bills of exchange. Domestic currencies and foreign currencies. Introduction to compound interest. Calculation of the final and initial values of capital. Factor of additional roles. Actualization factor. Amortization of loans in decursive calculation of interest. Repayment law. Repaid part of the debt. Amortization of loan with fixed and variable payments. The concept of annuity. Amortization of loan with fixed and variable annuities. Conversion of the loan. Rate and profitability of the loan. Loans divided into securities. Amortization of loan in inflation conditions. |
| Teaching Methods and Learning Activities: | Lectures i.e. transfer of systematic knowledge from the literature. In addition to examples that will be discussed, the classes will also cover the examples (solving problem tasks) that will be used to illustrate and practice specific topics. Preparation and presentation of the seminar paper will be done with the mandatory application of the Instructions for the preparation of scientific papers. |
| Literature: | Krčmar, М. (2007). Financial Mathematics and Methods of Investment Decision Making. Sarajevo: Kemigrafika; Kočović, J.; Pavlović, M. (2010). Introduction to Financial Mathematics. Belgrade: Faculty of Economics, Publishing Center; Kočović, J.; Rakonjac Antić, T. (2013). Workbook of solved problems from financial and actuarial mathematics. Belgrade: Faculty of Economics, Publishing Center. |
| Types of Assessment for the subject: | Colloquium I (0-20 points); Colloquium II (0-20 points); Final exam (0-50 points); Attendance (2point); Class activities (seminar papers, discussions, case studies) (0-8 points) |
| Special Remarks for the subject: |