actuarial science uconn math 2620 math 2620 uconn
actuarial science uconn
 financial mathematics i math 2620 final exam review sheet chapter 1 – interest rates  overview o interest: the birth of money from money, payment by the borrower for the use of an asset that belongs to the lender over a period of time o capital: the asset in question o principal: monetary capital o interest rate: percent of capital amount o risk of default: risk that borrower will not be able to repay the loan principal  if some then lender normally requires a higher interest rate  interest o interest on saving accounts 