Open AccessMathematical model in the banking on the ex ample of simple percentage
Author(s) -
Anna Małgorzata Jatczak
Publication year - 2021
Publication title -
vuzf review
Language(s) - English
Resource type - Journals
ISSN - 2534-9228
DOI - 10.38188/2534-9228.21.4.22
Subject(s) - loan , simple (philosophy) , value (mathematics) , stochastic game , mathematical economics , interest rate , mathematical finance , future value , set (abstract data type) , econometrics , economics , mathematics , computer science , financial economics , finance , statistics , philosophy , epistemology , programming language
Mathematical modeling is the description of the reality in the language of the mathematics and formal logic which creates symbols, mathematical relation and also strictly determined rules of employing them (Jaworski, Micał 2005). This article is devoted to the structure of the model describing the process of increasing the capital value within the time which basis constitutes the calculations based on the rule of simple percentage. In its content are determined the chosen, basic terms associated with the financial activity of the bank (including interest rate, interest, discount). Mathematical models are also discussed enabling to count:
the final capital for the initial capital with the fixed annual interest rate for the set time,
the initial capital which generated the determined final capital with the fixed annual interest rate for the set time,
the interest rate on the basis of the initial and final capital after certain time,
the initial value of the loan for the amount of the payoff within the fixed discount rate within the certain time,
the value of the commercial discount for one year on the basis of the initial value of the loan and the amount of its payoff.
The presented content will supply the reader with the knowledge in calculations applied in the banks associated with the simple percentage. The article constitutes the example of combination of the theoretical knowledge with the practice and it also shows how important mathematical modeling is in the modern world.