ACC 4550 - Financial Mathematics (3)

Fundamental concepts of financial mathematics. Topics include interest rate, annuities, amortization and sinking funds, bond valuation, and investment return. Replaces APM/ECN 450 Risk Management. Satisfies the university general education requirement for the capstone experience. Pre/Corequisites: MTH 2554 with a grade of C or higher and (FIN 3720 or FIN 3550) with a grade of C or higher.

• Able to apply the mathematical techniques leamed to financial products, for further analysis of financial instmments, and to personal financial management. Well prepared for the Society of Actuary (SOA) Professional Exam in Financial Mathematics (FM/2).
• The student will demonstrate appropriate uses of a variety of methods of inquiry and a recognition of ethical considerations that arise.
• In this course this entails knowledge of how students will understand mathematical theory of finance as related to financial valuations, particularly with regard to the critical roles of interest rates, valuation of annuities, loan repayment, bond valuation, and rate of return of an investment.
• The student will understand the terminology in financial industry and principle of Time Value of Money (TVM). There will be class discussion of ethical issues as related to conflict of interest in financial industry.
• The student will demonstrate the ability to integrate the knowledge learned in general education and its relevance to the student’s life and career. In this course, students will be expected to understand the basic principles and concepts for financial valuations, which they can apply to their own investing or companies. They will be expected to appreciate how their background prepares them for tackling new mathematics and computational methods as applied to financial applications they have likely not thought about before.
• Critical Thinking This course requires ability in critical thinking which is a constant challenge in mathematics and finance. Critical thinking and problem solving abilities in solving financial valuation problems will be the main focus of the homework and project assignments in this course.
• The assignments will give students opportunities to demonstrate the critical (financial) thinking capability. In general, class instructions will aim at developing “habits” of financial mathematical thinking, beyond financial reasoning and literacy taught in the classroom.

Copies of the textbooks will be available on 2-hour reserve at Kresge Library.

Microsoft Office 365 Free for OU Students. Enables access to a suite of Office 365 cloud products as well as download and install of the full Office Productivity Suite, including Word, Excel, PowerPoint, OneNote, and more. The software can be made available on up to 5 personal devices.

Calculator Policy:  For this course you will need a financial calculator that is compatible with the regulations of Society of Actuary. Ability to use financial calculators is an integral pati of the course. You may use the calculator on all tests, and it is important to learn to use it effectively.

The quizzes will be conducted under a semi problem-solving workshop environment

in the classroom Also, in-class tests and final exam will contain at least one problem specifically designed to test the ability of students to demonstrate skills in critical (financial) thinking and problem solving skills.

Homework Assignments: Students will be assigned weeldy homework sets of problems from the textbook. The weekly homework assignments will be collected and graded. Feedbacks will be given to the class on each returned assignment. The homework assignments will be designed to promote critical (financial) thinking and problem-solving skills in students.

Speed-and-Accuracy Quizzes:  There will be weekly speed-and-accuracy  quizzes. The quizzes will be designed to promote quick and critical thinking, recognizing patterns and links and, most impmiantly, promote ability to recall definitions.  Ability to recall definitions and financial tetminology is a critical factor in learning mathematics. The quizzes will be conducted under a semi problem-solving workshop environment in the classroom, and the workshop will serve as a simulation of the FM/2 Exam and in meeting the goals and objectives of a capstone course.

Tests:  There will be two tests (worth 100 points each).  All tests, including the final examination, are closed book, closed note. The dates of the two tests are TBD and TBD. The final examination is comprehensive.

Final Exam: The final examination is comprehensive. It is worth 200 points. It will be given on TBD, from TBD- TBD. The room for the final exam will be announced prior to the exam.

Grade Determination: Grades will be based on: Speed-and-Accuracy  Quizzes Homework Assignments

Grading To receive full  credit on tests, be sure to show all the work necessary for setting up a calculation before using the calculator.

Students will be assessed by means of:

Test 1 100 points

Test 2 100 points

Final Exam 200 points

Grading Scale: The final grade in the course will be based on the total points eamed out of 300 points. There is no fixed grading scale for this course. A conversion formula from your score to Oakland University grades will be detetmined at the end of the course. However, the following list shows the lowest possible grade that a given percentage score will eam (the grade may be higher than this): 95% ->A; 90% ->A-; 85% -> B+; 80% -> B; 75% -> B-; 70% -> C+; 65% -> C; 60% -> C-; 55%-> D+; 50%-> D.