An Introduction to Financial Mathematics, 2nd Edition

Contents

Preface

1    Basic Finance

1.1    Interest

*1.2    Inflation

1.3    Annuities

1.4    Bonds

*1.5    Internal Rate of Return

1.6    Exercises

2    Probability Spaces

2.1    Sample Spaces and Events

2.2    Discrete Probability Spaces

2.3    General Probability Spaces

2.4    Conditional Probability

2.5    Independence

2.6    Exercises

3    Random Variables

3.1    Introduction

3.2    General Properties of Random Variables

3.3    Discrete Random Variables

3.4    Continuous Random Variables

3.5    Joint Distributions of Random Variables

3.6    Independent Random Variables

3.7    Identically Distributed Random Variables

3.8    Sums of Independent Random Variables

3.9    Exercises

4    Options and Arbitrage

4.1    The Price Process of an Asset ...