Week 5 Study Plan
Overview
This week, we will cover the following topics:
- Risk and Insurance (Module 5.1-5.3): to put it in the way the CM2 notes puts it, how do we model the behaviours of agents on a market? What is a possible mathematical model for “rational” behaviour, that could explain why people purchase insurance?
- Excel (Module 6.1-6.5): EDA and Dynamic Arrays.
See also detailed learning outcomes of 5.2 (“Liability valuations / Run-off triangles”) of the CM2 syllabus, as well as CM2-B Excel examinations here.
Main references and lectures
Module 5 and 6
Read: Section 5.1 to 5.3 of Module 5: Utility, Risk and Insurance
Read: Section 6.1 to 6.5 of Module 6: Excel
Annotated slides and Excel spreadsheet: Annotated slides: UG/PG
Watch: refer to your lecture recording under “Lecture Capture” (UG/PG).
Additional preparation and resources
Mandatory
- Chapter 7.1-7.3 of Joshi (2013) (for Module 5)
Tutorials
Please let us know of any mistake or required update on Ed.
Tutorial materials
Tutorial exercises have been especially selected as more advanced exercises facilitating revisions and discussions during the face to face tutorials.
Solutions will only be released in the morning of the tutorials, to encourage students to have a go by themselves prior to the tutorial, but still allowing them to have something to annotate during the tutorial.
Please have a look at the Week 5 tutorial problem set before attending tutorials. The tutors will go through the questions with you, and you are encouraged to ask questions during tutorials.
Extra Exercises
Extra exercises, to be completed after the tutorial, and with solutions available straight away. It is recommended to attempt the questions before looking at the solutions.
Tutorials won’t discuss those questions in the tutorials, but will answer questions if you have any.
Work on the extra questions for week 5.
Preparation for assessment
Mid-semester (15%) and final (60%) exams
- Finalise your summary of Modules 1-4.
- Work on your cheat sheet for MST.
- Make sure you review all lecture slides, tutorial questions, and extra exercises. The MST should be easy if you complete all of them.
Note that all of Modules 1 to 4 are in scope for the mid-semester exam.
Assignment (25%)
- You can start to look at the assignment as it relates to utility, and if you have any questions about the assignment, feel free to ask on
Ed!