Equivalency Principles in Financial Mathematics

Result code in IS VaVaI

RIV/71226401:_____/11:#1000829 - isvavai.cz

Result on the web

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DOI - Digital Object Identifier

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Result language

angličtina

Original language name

Equivalency Principles in Financial Mathematics

Original language description

Showing an alternative introduction of the basic concepts of financial mathematics is the main goal of this paper. Almost all classic courses of financial mathematics start with the concepts of different types of interest that is regarded as a reward orcost in return for lending or borrowing money. This enables introduction of other concepts such as interest rates, accumulated values, discounted values, and so on. This paper describes another way. It is possible to proceed from the well-known and obvious fact that the real value of money is changed with time and define an equivalency of two values of money due at different times. Two sorts of the equivalencies are defined, the equivalence at simple and compound interest. The former does not have transitivity property, while the later does. It sometimes leads to inconsistencies at solving financial problems based on simple interest. An example illustrates the problem in question. Further an equivalency of two sets of values is introduc

Czech name

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Czech description

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Type

J_ost - Miscellaneous article in a specialist periodical

CEP classification

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OECD FORD branch

50206 - Finance

Project

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Continuities

V - Vyzkumna aktivita podporovana z jinych verejnych zdroju

Publication year

2011

Confidentiality

S - Úplné a pravdivé údaje o projektu nepodléhají ochraně podle zvláštních právních předpisů

Name of the periodical

LOGOS POLYTECHNIKOS

ISSN

1804-3682

e-ISSN

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Volume of the periodical

2

Issue of the periodical within the volume

3

Country of publishing house

CZ - CZECH REPUBLIC

Number of pages

12

Pages from-to

3-14

UT code for WoS article

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EID of the result in the Scopus database

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