# Module ASB-1115:Financial Mathematics

### Module Facts

10 Credits or 5 ECTS Credits

Semester 2

Organiser: Mr Ayan Orujov

### Overall aims and purpose

To develop mathematical skills to a level that allows the use of quantitative techniques in a wide variety of Financial and Economic applications.

### Course content

• Gradients and introduction to differentiation.
• Price elasticity and firm production functions.
• Second derivatives and optimization problems.
• Time-value of money: Future values of capital sums and savings plans; Present values of capital sums and annuities. Compound interest.
• Investment appraisal: Net Present Value (NPV) and Internal Rate of Return (IRR).
• Investment risk and return.

### Assessment Criteria

#### excellent

Excellent standard: A- to A+ (70%+) Class 1 An outstanding performance, exceptionally able. The relevant information accurately deployed. Excellent grasp of theoretical/conceptual/practice elements. Good integration of theory/practice/information in pursuit of the assessed work's objectives. Strong evidence of the use of creative and reflective skills.

#### threshold

D- to D+ (40-49%) No major omissions or inaccuracies in the deployment of information/skills. Some grasp of theoretical/conceptual/practical elements. Integration of theory/practice/information present intermittently in pursuit of the assessed work's objectives

#### C- to C+

C- to C+ (50-59%) Much of the relevant information and skills mostly accurately deployed. Adequate grasp of theoretical/conceptual/practical elements. Fair integration of theory/practice/information in the pursuit of the assessed work's objectives. Some evidence of the use of creative and reflective skills.

#### good

High Standard: B- to B+ (60-69%) Class 2.1 Very good performance Most of the relevant information accurately deployed. Good grasp of theoretical/conceptual/practical elements. Good integration of theory/practice/information in pursuit of the assessed work's objectives. Evidence of the use of creative and reflective skills.

### Learning outcomes

1. Understand the application of financial mathematics techniques to value cash flows that take place over time.

2. Derive and manipulate algebraic equations, differentiate and solve optimization problems.

3. Apply all techniques to business, economics and finance problems involving cash flows such as revenues, costs, profit and interest.

### Assessment Methods

Type Name Description Weight
CLASS TEST Class test

Class test testing knowledge of the skills covered

30
EXAM Exam S2 1.5 hrs

Examination testing knowledge of the material covered during the semester

70

### Teaching and Learning Strategy

Hours
Private study 60
Workshop

2-hour drop in workshop per week.

20
Lecture

One 2-hour lecture per week;

20

### Transferable skills

• Numeracy - Proficiency in using numbers at appropriate levels of accuracy
• Self-Management - Able to work unsupervised in an efficient, punctual and structured manner. To examine the outcomes of tasks and events, and judge levels of quality and importance
• Exploring - Able to investigate, research and consider alternatives
• Inter-personal - Able to question, actively listen, examine given answers and interact sensitevely with others
• Critical analysis & Problem Solving - Able to deconstruct and analyse problems or complex situations. To find solutions to problems through analyses and exploration of all possibilities using appropriate methods, rescources and creativity.
• Self-awareness & Reflectivity - Having an awareness of your own strengths, weaknesses, aims and objectives. Able to regularly review, evaluate and reflect upon the performance of yourself and others

### Subject specific skills

• Framing. Through the study of economics, a student should learn how to decide what should be taken as given or fixed for the purposes of setting up and solving a problem, i.e. what the important 'parameters' are in constraining the solution to the problem. Learning to think about how and why these parameters might change encourages a student to place the economic problem in its broader social and political context. This 'framing' skill is important in determining the decision-maker's ability to implement the solutions to problems.
• Numeracy: the use of quantitative skills to manipulate data, evaluate, estimate and model business problems, functions and phenomena.

### Resources

#### Resource implications for students

There are no resource implications for students