### Archive

Archive for February, 2009

## Course Intro

February 26th, 2009

I’ve added a Course Introduction lesson.  I know it is a little late, but I wanted to wait for the website changes.  It is about 15 minutes and definitely worth watching.  It is in the “Before You Begin” section.

## A.5 Solutions

February 24th, 2009

I’ve added PDF solutions for the following A.5 problems:

1, 2, 6, 7, 8, 9

## NAR convertible every X years

February 20th, 2009

When the NAR is convertible less frequently than a year it seems to give lots of students trouble.  Here is an email I sent recently to a student struggling with this idea.  I hope it helps.

A nominal annual rate is an ANNUAL rate and a rate in NAME ONLY (that’s where the nominal comes).  So when you have a nominal annual rate the first thing to do is convert it to an effective rate per the convertible period.

For example, if we have a nominal rate of 12% convertible semi-annually, then the first thing we do is divide by the number of compounding periods per year (since it is ANNUAL).  Thus 12% / 2 = 6% effective per 6 months (the convertible period).  Now we can actually use that 6% rate to move money around.  To accumulate money for 6 months we simply multiply by 1.06.  To move it for a year (which is 2 six-month periods) we multiply by (1.06)^2.  To discount money for 10 years we would divide by (1.06)^20 since there are 20 six-month periods in 10 years.

Now assume that we are given a nominal rate of 12% convertible once every 4 years.  Remember the 12% is an NOMINAL ANNUAL rate so first thing is to get the effective rate that we can use.  12% x 4 = 48% effective rate per 4 years (the convertible period).  So if we want to accumulate money for 1 year then we multiply by (1.48)^(1/4) since 1 year is 1/4 of 4 years.  If we want to accumulate money for 4 years then we multiply by 1.48.  If we want to discount money for 40 years then we divide by (1.48)^10 since there are 10 four-year periods in 40 years.

## A.4 Solutions

February 20th, 2009

I’ve added the following PDF solutions to A.4:

2, 3, 4, 6, 7, 11, 14, 19, 23, 25, 31, 33, 34, 35, 39, 42, 43, 44, 51

## A.3 Solutions

February 20th, 2009

I’ve added the following PDF solutions for A.3:

16, 17, 44, 45, 46, 51, 53, 54, 56, 57, 59, 64, 65, 68, 69, 72, 74, 75, 76, 81, 82, 87, 109, 110, 111, 112, 113, 114, 115, 116, 119, 121, 123, 124, 125, 127, 128, 129, 130, 131, 133, 134, 135, 136, 137, 138, 145, 148, 149, 150, 151, 152

## A.2 Solutions

February 19th, 2009

I’ve added the following PDF solutions for A.2:

2, 5, 23, 38, 42, 43, 44, 47, 52, 54, 56, 58, 59, 68, 78, 87, 88, 104, 106, 113, 121, 132, 133, 134, 135, 136, 137, 138, 139, 140, 141, 142, 143

## More Solutions

February 18th, 2009

Ok I give up.  :)

I have purposely withheld solutions b/c I think some students turn to solutions too quickly.  There is a lot of value in struggling through a problem yourself.  If you can do it then I think you are more likely to remember how to solve the problem vs. looking at somebody else’s solution.  However, I fear that some students are too shy to ask for help.  So I’ve decided to add more solutions.  I’m going to start with the PDF solutions I have already created, then I will add some more video solutions.

Today I added the following PDF solutions for A.1.  You can view these by logging into the site, clicking My Stuff in the top right and then selecting ‘Joint 2/FM Solutions’.

3, 5, 11, 12, 14, 29, 33, 34, 39, 40, 44, 58, 60, 62, 66, 67, 68, 69, 70, 72, 73, 76, 78, 81, 86, 88

## Website Changes

February 17th, 2009

As you have probably noticed, we have added a few new features to the website. It now displays for you which lessons you have viewed and not viewed, which should make it easier to keep track of where you are. It will also show you what lessons have been added or updated. If the changes aren’t self-explanatory, you can watch a video explaining them that is linked on most pages, and is also at http://www.theinfiniteactuary.com/files/newvideo.wmv If you have comments and suggestions about the new look, please let me know or post comments in the blog.

One brief comment about the new look is that it only tracks the videos that you have seen since the change (i.e., since 2/15). This means that videos that you viewed earlier will say that they are unviewed. The easiest solution to this is to not care very much, but if you want to have the check marks and an accurate count of the fraction of the lessons that you have viewed, then you can trick the system by opening the videos and close the window as soon as the video starts.