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Course Outline

Course Name: Mathematics of Finance (BMTH 120)

Academic Period: 2023 - 2024

Faculty:


Faculty Availability:

Associate Dean:
Mike Wells
mike.wells@humber.ca

Schedule Type Code:

Land Acknowledgement

Humber College is located within the traditional and treaty lands of the Mississaugas of the Credit. Known as Adoobiigok [A-doe-bee-goke], the “Place of the Alders” in Michi Saagiig [Mi-Chee Saw-Geeg] language, the region is uniquely situated along Humber River Watershed, which historically provided an integral connection for Anishinaabe [Ah-nish-nah-bay], Haudenosaunee [Hoeden-no-shownee], and Wendat [Wine-Dot] peoples between the Ontario Lakeshore and the Lake Simcoe/Georgian Bay regions. Now home to people of numerous nations, Adoobiigok continues to provide a vital source of interconnection for all.

Equity, Diversity and Inclusion Statement

Humber College and the University of Guelph-Humber (Humber) are leaders in providing a learning, working and living environment that recognizes and values equity, diversity and inclusion in all its programs and services. Humber commits to reflect the diversity of the communities the College serves. Students, faculty, support and administrative staff feel a sense of belonging and have opportunities to be their authentic selves.

Faculty or Department Faculty of Liberal Arts & Sciences
Course Name: Mathematics of Finance (BMTH 120)
Pre-Requisites none
Co-Requisites none
Pre-Requisites for

BSTA 200
Equates none
Restrictions none
Credit Value 3
Total Course Hours 42
Developed By: Prepared By: Approved by:
Mike Wells

Humber Learning Outcomes (HLOs) in this course.

The HLOs are a cross-institutional learning outcomes strategy aimed at equipping Humber graduates with the employability skills, mindsets, and values they need to succeed in the future of work. To explore all the HLOs, please consult the Humber Learning Outcomes framework.

  • A white canoe rowing into a red circleCritical Thinking
  • A white howling coyote in a green circleCommunication
  • A white beaver falling from the top of a purple and yellow circle to the centre of the circleStrategic Problem-Solving

Course Description

Mathematics of Finance is an introductory course that introduces students to the mathematical concepts necessary for success in business. The major topics include compound interest, annuities, amortization, discounted cash flow and net present value as they relate to investment decisions, break-even analysis and mathematics of merchandising.

Course Rationale

Mathematics of Finance gives students a strong mathematical foundation which complements their studies in business. Students will learn the mathematical skills needed to be successful in business and appreciate how mathematics is an essential part of the world of business.

Course Learning Method(s)

  • Problem Based Learning (PBL)
  • Lecture
  • Online

Course Learning Outcomes (CLO)

Learning Outcome Learning Objectives Summative Assessments Formative Assessments
Solve applied compound interest problems involving the future value and present value.
  • Learn the concepts behind compound interest.
  • Use the BAII plus calculator to calculate the future value and present value.
  • Solve applied problems involving future value and present value, including problems involving multiple steps.
  • Quizzes
  • Test 1
  • In-class Assessment
    Solve applied compound interest problems requiring solving for the nominal annual interest rate, number of compounding periods and time period.
    • Use the BAII plus calculator to find the nominal annual interest rate, given an applied problem.
    • Use the BAII plus calculator to find the number of compounding periods given an applied problem and use this information to determine the time period.
    • Test 1
    • Quizzes
    • In-class Assessment
      Compute effective and equivalent interest rates for compounding interest problems.
      • Use the BAII plus calculator to convert between effective and nominal interest rates and to determine equivalent nominal interest rates.
      • Quizzes
      • Test 1
      • In-class Assessment
        Identify types of annuities based on the timing of the payments and compounding periods.
        • Identify types of annuities based on the timing of the payments and compounding periods.
        • Test 1
        • Quizzes
        • In-class Assessment
          Solve ordinary annuity and annuity due problems for simple and general annuities, involving solving for future and present value, computing the periodic payment, number of payments, time period and nominal interest rates.
          • Use the BAII plus calculator to find the future value and present value of ordinary simple, ordinary general, simply annuity due and general annuity due annuities.
          • Use the BAII plus calculator to determine the payment size given an applied problem.
          • Determine the number of payments and associated time period for an applied problem.
          • Use the BAII plus calculator to determine the nominal interest rate of an applied annuity problem.
          • Quizzes
          • Test 1
          • In-class Assessment
            Construct complete and partial amortization schedules for loans involving ordinary simple and general annuities.
            • Construct amortization schedules where the final payment is the same.
            • Construct amortization schedules where the final payment is different.
            • Calculate the outstanding balance, interest paid and principal repaid after a period of time.
            • Test 2
            • Quizzes
            • In-class Assessment
              Calculate payment amounts and outstanding principal balance on mortgages.
              • Calculate mortgage payment amounts.
              • Calculate new mortgage payment amount after a change in interest rate.
              • Calculate the outstanding balance, interest paid and principal repaid after a period of time.
              • Quizzes
              • Test 2
              • In-class Assessment
                Evaluate the feasibility of a project on the basis of the discounted cash flow criterion and the net present value criterion.
                • Make business decisions based on the discounted cash flow criterion.
                • Make business decisions based on the net present value criterion.
                • Quizzes
                • Test 2
                • In-class Assessment
                  Perform break-even and cost-volume profit analyses.
                  • Calculate the break-even point, given the fixed costs, variable costs and selling price.
                  • Calculate the contribution margin and contribution ratio.
                  • Graphically solve a break-even problem.
                  • Quizzes
                  • Test 2
                  • In-class Assessment
                    Solve problems involving trade discounts and cash discounts, including discount series.
                    • Calculate the net price after a single discount or series of discounts.
                    • Calculate the list price before a discount or series of discounts was applied.
                    • Calculate the single equivalent discount rate.
                    • Calculate a cash discount based on the invoice terms.
                    • Quizzes
                    • Test 2
                    • In-class Assessment
                      Solve pricing problems involving markup, markdown and discounts.
                      • Solve for selling price, markup or cost based on the information given.
                      • Calculate the profit when an item is sold at the regular price, based on the information given.
                      • Calculate the profit or loss when an item is sold at a discount, based on the information given.
                      • Calculate the amount of discount and discounted price.
                      • Quizzes
                      • Test 2
                      • In-class Assessment

                        Assessment Weighting

                        Assessment Weight
                        In-class Exercise
                            In-class Assessment 10%
                        Test
                            Test 1 25%
                            Test 2 25%
                        Quiz
                            Quizzes 40%
                        Total 100%

                        Modules of Study

                        Module Course Learning Outcomes Resources Assessments
                        Module 1: Compound interest
                        • Solve applied compound interest problems involving the future value and present value.
                        • Solve applied compound interest problems requiring solving for the nominal annual interest rate, number of compounding periods and time period.
                        • Compute effective and equivalent interest rates for compounding interest problems.

                        9.1 - 10, 11, 12, 1
                        9.2 - 1, 2, 4, 7, 10, 11
                        9.3 - 1, 3, 4, 10, 11, 14
                        9.5- 1, 2, 9, 10, 11
                        9.6- 1-9, 11,13,14,16
                        9.7 - 3, 6, 11, 13, 15
                        • Quizzes
                        • Test 1
                        Module 2: Future value and present value of annuities
                        • Solve ordinary annuity and annuity due problems for simple and general annuities, involving solving for future and present value, computing the periodic payment, number of payments, time period and nominal interest rates.
                        • Identify types of annuities based on the timing of the payments and compounding periods.

                        11.1- 1, 2, 4-10
                        11.2- 1, 2, 3, 5-12
                        11.3 -1, 2, 3, 11, 12, 13
                        • Quizzes
                        • Test 1
                        Module 3: Payments, time and interest rate of annuities
                        • Solve ordinary annuity and annuity due problems for simple and general annuities, involving solving for future and present value, computing the periodic payment, number of payments, time period and nominal interest rates.

                        11.4 - 9, 10a, 11a, 12
                        11.5 – 9,10,11,13
                        11.6 - 1-11
                        • Quizzes
                        • Test 1
                        Module 4: Amortization of loans and mortgages
                        • Construct complete and partial amortization schedules for loans involving ordinary simple and general annuities.

                        13.1 - 1, 3, 5-11, 13

                        13.2 - 1, 2, 5, 11, 12
                        13.3 - 1, 2, 5, 6, 9, 10, 12

                        13.4 - 1, 4, 9, 10, 11
                        • Quizzes
                        • Test 2
                        Module 5: Business investment decisions
                        • Evaluate the feasibility of a project on the basis of the discounted cash flow criterion and the net present value criterion.

                        15.1 - 1, 2, 3, 7, 10, 11, 13
                        • Quizzes
                        • Test 2
                        Module 6: Break-even and cost-volume-profit analysis
                        • Perform break-even and cost-volume profit analyses.

                        5.1 - 9, 11, 12, 13

                        5.2 - 1, 2, 5, 6, 9, 11, 12
                        • In-class Assessment
                        • Quizzes
                        • Test 2
                        Module 7: Mathematics of merchandising
                        • Solve problems involving trade discounts and cash discounts, including discount series.
                        • Solve pricing problems involving markup, markdown and discounts.

                        6.1 - 1, 2, 3, 4, 5, 6, 7, 8, 9, 10, 11
                        7.4 - 1, 9, 13
                        6.2 - 1, 2, 9, 10, 11, 14
                        6.3 - 3, 4, 7, 8
                        • In-class Assessment
                        • Quizzes
                        • Test 2

                        Required Resources

                        Title ISBN

                        Business Math: A Step-by-Step Handbook by Jean-Paul Olivier (Open resource, available to download here: https://math.libretexts.org/Bookshelves/Applied_Mathematics/Business_Math_%28Olivier%29)

                        Students enrolled in online sections of the course may be required to come to campus to write the tests and exams.

                        Resource(s):

                        Course material costs can be found through the Humber Bookstore.

                        Additional Tools and Equipment

                        • Required calculator: Texas Instruments – BA II Plus, or the free smart phone app BA Financial Calculator by Angel Montana.

                        Essential Skills

                        Section Skills Measurement Details
                        Communication
                        • Reading
                        		 Reinforce and measure
                        • Students will be shown how to extract important information from word problems and use the information to solve problems.
                        • Written assessments.
                        Numeracy
                        • Understanding and applying mathematical concepts and reasoning
                        		 Teach and measure
                        • Students will use mathematics to solve applied problems.
                        • Written assessments.
                        Critical Thinking and Problem-Solving
                        • Analysing
                        • Decision-Making
                        		 Teach and measure
                        • Students will analyze word problems to determine the solution and will make investment decisions based on given information.
                        • Written assessments.
                        Information Management
                        • Selecting and using appropriate tools and technology for a task or project
                        • Computer literacy
                        • Internet skills
                        		 Teach and measure
                        • Students are taught how to solve financial problems using a financial calculator. They are also expected to navigate the online Blackboard site to find course material and complete assessments online.
                        • Written assessments.
                        Personal Skills
                        • Managing self
                        • Demonstrating personal responsibility
                        		 Teach and measure
                        • Students are required to manage their time in order to complete all quizzes and prepare for tests.
                        • Written assessments.

                        Prior Learning Assessment & Recognition (PLAR)

                        Prior Learning Assessment and Recognition (PLAR) is the formal evaluation and credit-granting process whereby candidates may obtain credits for prior learning. Prior learning includes the knowledge competencies and skills acquired, in both formal and informal ways, outside of post-secondary education. Candidates may have their knowledge, skills and competencies evaluated against the learning outcomes as defined in the course outline. Please review the Assessment Methods Glossary for more information on the Learning Portfolio assessment methods identified below.

                        The method(s) that are used to assess prior learning for this course may include:

                        • Challenge Exam (results recorded as a % grade and added to student’s CGPA)

                        Please contact the Program Coordinator for more details.

                        Academic Regulations

                        It is the student's responsibility to be aware of the College Academic Regulations. The Academic Regulations apply to all applicants to Humber and all current students enrolled in any program or course offered by Humber, in any location. Information about academic appeals is found in the Academic Regulations.  

                        Anti-Discrimination Statement

                        At Humber College, all forms of discrimination and harassment are prohibited. Students and employees have the right to study, live and work in an environment that is free from discrimination and harassment. If you need assistance on concerns related to discrimination and harassment, please contact the Centre for Human Rights, Equity and Inclusion or the Office of Student Conduct.

                        Accessible Learning Services

                        Humber strives to create a welcoming environment for all students where equity, diversity and inclusion are paramount. Accessible Learning Services facilitates equal access for students with disabilities by coordinating academic accommodations and services.  Staff in Accessible Learning Services are available by appointment to assess specific needs, provide referrals and arrange appropriate accommodations. If you require academic accommodations, contact:

                        Accessible Learning Services

                        North Campus: (416) 675-6622 X5090

                        Lakeshore Campus: (416) 675-6622 X3331 

                        Academic Integrity

                        Academic integrity is essentially honesty in all academic endeavors. Academic integrity requires that students avoid all forms of academic misconduct or dishonesty, including plagiarism, cheating on tests or exams or any misrepresentation of academic accomplishment.

                        Disclaimer

                        While every effort is made by the professor/faculty to cover all material listed in the outline, the order, content, and/or evaluation may change in the event of special circumstances (e.g. time constraints due to inclement weather, sickness, college closure, technology/equipment problems or changes, etc.). In any such case, students will be given appropriate notification in writing, with approval from the Senior Dean (or designate) of the Faculty.

                        Copyright

                        Copyright is the exclusive legal right given to a creator to reproduce, publish, sell or distribute his/her work. All members of the Humber community are required to comply with Canadian copyright law which governs the reproduction, use and distribution of copyrighted materials. This means that the copying, use and distribution of copyright- protected materials, regardless of format, is subject to certain limits and restrictions. For example, photocopying or scanning an entire textbook is not allowed, nor is distributing a scanned book.

                        See the Humber Libraries website for additional information regarding copyright and for details on allowable limits.

                        Humber College Institute of Technology and Advanced Learning • 2023/2024.