FINANSIJSKA I AKTUARSKA MATEMATIKA

After completion of this course the student will be able to: 1. Distinguish simple from complex proportion, division of given value, weighted average and apply the percentages to solve business mathematics tasks. 2. Distinguish rate of interest from rate of discount, nominal, relative and effective interest rate and apply these concepts in determining the prices of instruments in the money market. 3. Determine the annuity and to make a plan of repayment of consumer and investment loans. 4. Apply the equivalence principle and the methods of discounting and prolongation in testing the profitability of investments, as well as in evaluation of long-term bonds and shares. 5. Calculate the discount factor with a variable interest rate, applied it to periodic annuities and compare it with the discount factors in discrete and continuous case with a constant interest rate. 6. Calculate the discount factor in insurance-technical sense, define biometric functions and apply financial mathematics and probability to solve simple actuarial mathematics tasks. 7. Describe the types of life insurance and to calculate the net and gross premium for each of them.