Loan Notation and Terminology (SOA Exam FM–Financial Mathematics–Module 3, Section 1)

Описание: Kick off Module 3 of SOA Exam FM with a clear walkthrough of loan notation and terminology. You’ll learn what each symbol and term means in plain English, how payments split into interest and principal, and how to read balances before and after a payment using an intuitive timeline. Perfect for building a solid base before moving into amortization schedules and bond topics.

What you’ll learn:
Loan amount, payment amount, number of payments
Interest vs principal in each payment
Outstanding balance concepts
Timeline setup and quick logic checks
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SOA Exam FM (Financial Mathematics) Module 3, Section 1

After completing this video you should be able to:

Define and recognize the definitions of the following terms:

𝐿−Loan Amount
𝑖−Periodic Effective Loan Interest Rate
𝑛−Number of Periodic Payments
𝑅𝑘−Amount of the 𝑘th payment
𝐼𝑘−Amount of Interest Paid during the 𝑘th period
𝑃𝑘−Amount of Principal Repaid with the 𝑘th payment
𝑅𝑘=𝐼𝑘+𝑃𝑘
𝐵𝑘−Balance Immediately After the 𝑘th payment

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