Schedule of Classes

Introduction to mathematics of finance. Emphasis is placed on the applications of mathematical techniques to important financial concepts such as capital budgeting, measures of risk and return, investments, and market efficiency. Techniques of optimization as applied to diversification and portfolio management.

Data presentation and computation of descriptive measures. Probability theory, probability distributions, expectations, variance, covariance, correlation coefficient. Sampling, central limit theorem, statistical estimation, one or two sample tests of hypotheses.

Linear and multiple regression, correlation, analysis of variance, contingency tables, time series, decision theory, and non-parametric methods. Data analysis using statistical computer packages.

Develops basic principles and techniques of forecasting through integration of scientific and judgmental forecasting in financial applications. Objective analysis of historical data is combined with subjective insight to demonstrate how data for budgets can be developed, profits maximized, and risks reduced. Emphasis on use of forecasting by individual firms.