Mathematics 280, Theory of Interest, Spring 2001

Illinois State University Mathematics Department



Instructor
Dr. Krzysztof Ostaszewski , FSA , CFA ., MAAA
Actuarial Program Director
Office: Stevenson Hall, room 313G.
Telephone: 309-438-7226, Fax: 309-438-5866.
Yahoo toll-free voicemail : 800-MY-YAHOO box 5202441757. Efax.com fax: 520-244-1757.
E-mail: krzysio@ilstu.edu


Classes meet
Mondays and Wednesdays 2:00-3:50 p.m., in Stevenson Hall, room 136B.


Office Hours
Mondays and Wednesdays 1:00-2:00 p.m. Please ask for an appointment at other times.


Textbook
The Theory of Interest, 2nd Edition, by Stephen G. Kellison, published in 1991 by Richard D. Irwin, Inc . Supplementary textbook: ACTEX Study Manual for SOA Course 2 and CAS Exam 2 (Interest Theory) , 2000 Edition ISBN 1-56698-366-5, by Dick London.


Objective
The objective of this class is to help you learn about theory of interest as covered on the Casualty Actuarial Society /Society of Actuaries Course 2 examination . The concepts and models we will discuss are akey part of modern actuarial science. The specific material covered on this part of the exam is: Theory of Interest (Second Edition), 1991 , by Kellison, S.G., Chapters 1-3 (exclude 3.6, 3.7, 3.10), 4, 5 (exclude 5.7, 5.9), 6 (exclude 6.7, 6.8), 7 (7.3, 7.4 only), and 8 (8.5, 8.7 only).


Grading
There will be five tests. You can have a make-up test, but a make-up will be made intentionally at least 20% more difficult. The best three of your five tests will count as 1/3 of your grade each. The grading scale will be as follows: 80% or better -- A, 70% to 80% -- B, 60% to 70% -- C, 50% to 60% -- D, below 50% -- F. You will also receive up to 20% extra credit for quizes which will be given in many classes, as indicated in the schedule below.  While the grading scale may appear liberal, it is justified by the level of difficulty of the material.

Other issues
You are expected to be in class, be prepared and able to contribute to the discussion.  The classroom is a place of learning and showing respect for others at all times.


Schedule of classes
  • Wednesday, January 17, 2001. Chapter 1: The measurement of interest.
  • Monday, January 22, 2001. Chapter 1: The measurement of interest. Quiz 1.
  • Wednesday, January 24, 2001. Chapter 1: The measurement of interest. Quiz 2.
  • Monday, January 29, 2001. Chapter 2: Solutions of problems in interest.
  • Wednesday, January 31, 2001. Chapter 2: Solutions of problems in interest. Quiz 3 .
  • Monday, February 5, 2001. Chapter 2: Solutions of problems in interest . Quiz 4 .
  • Wednesday, February 7, 2001. Chapter 3: Basic annuities.
  • Monday, February 12, 2001. Test No. 1, covering Chapters 1-2.
  • Wednesday, February 14, 2001. Chapter 3: Basic annuities .
  • Monday, February 19, 2001. Chapter 3: Basic annuities . Quiz 5 .
  • Wednesday, February 21, 2001. Chapter 4. More general annuities. Quiz 6 .
  • Monday, February 26, 2001. Chapter 4. More general annuities . Quiz 7 .
  • Wednesday, February 28, 2001. Chapter 4. More general annuities . Quiz 8 .
  • Monday, March 5, 2001. Chapter 5. Yield Rates.
  • Wednesday, March 7, 2001. Chapter 5. Yield Rates . Quiz 9 .
  • Monday, March 19, 2001. Chapter 5. Yield Rates . Quiz 10 .
  • Wednesday, March 21, 2001. Chapter 6. Amortization schedules and sinking funds.
  • Monday, March 26, 2001. Chapter 6. Amortization schedules and sinking funds. Quiz 11 .
  • Wednesday, March 28, 2001. Test No. 2, covering Chapters 1-5 .
  • Monday, April 2, 2001. Chapter 6. Amortization schedules and sinking funds . Quiz 12 .
  • Wednesday, April 4, 2001. Chapter 7. Bonds and other securities.
  • Monday, April 9, 2001. Chapter 7. Bonds and other securities. Quiz 13.
  • Wednesday, April 11, 2001. Chapter 7. Bonds and other securities. Quiz 14 .
  • Monday, April 16, 2001. Chapter 8. Practical applications.
  • Wednesday, April 18, 2001. Chapter 8. Practical applications. Quiz 15 .
  • Monday, April 23, 2001. Chapter 8. Practical applications. Quiz 16 .
  • Wednesday, April 25, 2001. Extra test , comprehensive.
  • Monday, April 30, 2001. Test No. 3 , comprehensive.
  • Wednesday, May 2, 2001. Test No. 4 , comprehensive.
  • Wednesday, May 9, 2001, 1:00 p.m. -- 3:00 p.m.. Test No. 5 (final) , comprehensive.


  • All information contained here is, to our best knowledge, correct, but it is merely a representation, and should not be considered to be any form of professional advice. This electronic publication should not be misconstrued as the official position of Illinois State University, or its Department of Mathematics. We are glad to provide as much information as possible here, but we kindly ask that in any decision related to matters listed here you seek additional counsel and information. Comments on this page are welcome and should be sent to Dr. Krzysztof Ostaszewski  at his e-mail address: krzysio@ilstu.edu.