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Summary: 1/52
Chapter 4. Amortization and sinking bonds.
Manual for SOA Exam FM/CAS Exam 2.
Chapter 4. Amortization and sinking bonds.
Section 4.1. Amortization schedules.
c 2009. Miguel A. Arcones. All rights reserved.
Extract from:
"Arcones' Manual for the SOA Exam FM/CAS Exam 2,
Financial Mathematics. Fall 2009 Edition",
available at http://www.actexmadriver.com/
c 2009. Miguel A. Arcones. All rights reserved. Manual for SOA Exam FM/CAS Exam 2.
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Chapter 4. Amortization and sinking bonds. Section 4.1. Amortization schedules.
In this chapter, we study different problems related with the
payment of a loan. Suppose that a borrower (also called debtor)
takes a loan from a lender. The borrower will make payments
which eventually will repay the loan. Payments made by the
borrower can be applied to the outstanding balance or not.
According with the amortization method, all the payments made
by the borrower reduce the outstanding balance of the loan.
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