The Fast Forward MBA in Business Math

by Peter Garrity

• ISBN13: 9780471315032
• ISBN10: 0471315036
• Format: Paperback
• Copyright: 1999-12-01
• Publisher: Wiley

Summary

The Fast Forward MBA in Business Math brings you the information you need when you need it most-now! This practical, easy-to-use guide gives you instant access to such crucial business math concepts as algebra, time value of money, and statistics. In short, lively segments using real-world examples, Professor Peter Garrity of Columbia Business School delivers the facts you need to master everyday business math problems-whether in product development, forecasting budgets, or even starting a business. You'll find brief descriptions of key business math concepts, tips on real-world applications, compact case studies, and technology shortcuts. Here are all the tools you need to manage even the most intricate business math problems. You'll discover: * How to master the basic quantitative skills that are part of any business environment, such as future and present value, internal rate of return, and net present value * Tips for using the latest software and technology tools to solve business math problems * How to use statistics for decision making, such as descriptive statistical analysis and regression * And much more From the creators of the bestselling Portable MBA series comes The Fast Forward MBA . . . * A quick way to brush up on new ideas * An easy-to-use format that fits in any briefcase * Real-world information that you can put to use now!

Author Biography

PETER GARRITY, PhD, is a professor at Columbia University Business School and teaches in the MBA and Executive MBA programs. He has developed and implemented applied mathematics instruction to J.P. Morgan, PaineWebber, Chase Manhattan Bank, and others.

Table of Contents

PART 1---MAKING DECISIONS WITH TIME VALUE OF MONEY: IT MAKES CENTS	1	(141)
The Basics of Time Value of Money	3	(22)
A Simpler Time: The Basic Definitions	4	(4)
The Nature of Compound Interest	8	(5)
Time Value of Money and Your Calculator	13	(3)
Applications of Future Value	16	(8)
End Point	24	(1)
The Dynamics of Compounding	25	(20)
Compounding in a Nutshell	25	(5)
Understanding Nominal and Effective Rates	30	(6)
The Best Compounding Relationship	36	(5)
Applications of Periodic Compounding	41	(2)
End Point	43	(2)
The Significance of Present Value	45	(20)
Defining Present Value	45	(7)
Determining Rate of Return	52	(1)
Finding the Annual Rate of Return	53	(1)
Determining Time to Achieve a Specified Return	54	(1)
Applications of Present Value	55	(7)
End Point	62	(3)
The Fundamentals of Cash Flows	65	(24)
Defining a Cash Flow	66	(1)
Defining Annuities	66	(7)
Annuity Structure of an IRA Plan	73	(1)
The Present Value of an Annuity	73	(3)
Determining the Payment Amount	76	(2)
Applications of Cash Flow Analysis	78	(9)
End Point	87	(2)
The Beauty of Bonds	89	(28)
The Nature of Bonds	89	(1)
Defining Bonds	90	(1)
How Coupon Bonds Work	90	(3)
Cash Flow for a Zero-Coupon Bond	93	(4)
What Makes Bonds Attractive Investments	97	(11)
Applications of Bond Cash Flows	108	(3)
Determining Yield to Maturity	111	(4)
End Point	115	(2)
The Decision-Making Power of Internal Rate of Return and Net Present Value	117	(24)
How Companies Compare Returns among Competing Projects	118	(4)
What the Internal Rate of Return Tells You	122	(5)
Introducing Net Present Value (NPV)	127	(6)
Applications of IRR and NPV	133	(7)
End Point	140	(1)
PART 2---BUSINESS STATISTICS: MAKING DECISIONS FROM DATA	141	(148)
Organizing Your Data for Better Decision Making	143	(32)
Statistics in Action	143	(1)
Descriptive versus Inferential Statistics	144	(4)
Rules Regarding Sampling	148	(3)
Details Regarding Frequency Classes	151	(6)
The Mean as a Measure of Central Tendency	157	(6)
The Median---Not Influenced by Outliers	163	(1)
Mean or Median---Which Is Better?	164	(1)
The Mode---Identifying the Clusters	165	(1)
Skewness	166	(1)
Applications of Data Organization and Central Tendency	166	(6)
End Point	172	(3)
Describing Variation	175	(18)
Defining Variation	176	(1)
The First Measure of Variation: Range	177	(1)
The Second Measure of Variation: Average Deviation	178	(2)
A Better Measure of Variation: Variance	180	(2)
The Almighty Standard Deviation	182	(4)
The Coefficient of Variation	186	(1)
Applications of Data Variation	187	(4)
End Point	191	(2)
Fundamentals of Probability Distributions	193	(18)
The Nature of Random Variables	194	(1)
Discrete and Continuous Variables	194	(1)
Introducing Probability	195	(8)
Expected Value and the Mean	203	(3)
Applications of the Binomial Distribution	206	(3)
End Point	209	(2)
Probability and the Normal Distribution	211	(28)
Perspective on the Normal Distribution	212	(7)
Finding Probabilities with the Normal Distribution	219	(1)
The Importance of Sketching	219	(1)
Using the Standard Normal Distribution	220	(7)
The Importance of Sample Means	227	(2)
Applications of the Normal Distribution	229	(8)
End Point	237	(2)
Hypothesis Testing	239	(20)
Hypothesis Testing and Quality Control---A Case	240	(1)
Defining the Null Hypothesis Setup	240	(1)
Creating a Null Hypothesis	241	(1)
Decision Options in Hypothesis Testing	242	(2)
Determining Risk with Type I and Type II Errors	244	(9)
Using Level of Significance to Define Decision Limits or Critical Values	253	(2)
Applying Hypothesis Testing	255	(2)
End Point	257	(2)
Regression and Estimation	259	(30)
Correlation and Causation	260	(1)
The Difference between Regression and Correlation	260	(1)
Types of Regression Models	261	(1)
Conducting a Bivariate Study	262	(2)
Mapping the Steps in Regression Analysis	264	(7)
Regression and the Computer	271	(5)
Applications of Regression Analysis	276	(11)
End Point	287	(2)
PART 3---ALL THE ALGEBRA AND HIGH SCHOOL MATH YOU NEED FOR BUSINESS	289	(42)
Algebra Redux	291	(40)
Recommended Method of Proceeding	291	(1)
Operations with Numerical and Algebraic Expressions	292	(5)
The Importance of Factoring	297	(2)
Solving First-Degree Equations	299	(2)
Functions	301	(5)
The Importance of Slope	306	(2)
Behavior of the Quadratic Function	308	(5)
Solving Systems of Equations	313	(5)
Behavior of the Exponential Function	318	(3)
Behavior of ex and Continuous Compounding	321	(2)
Using Summation Notation	323	(1)
Using Logarithms	324	(3)
Factorials and Their Applications	327	(4)
Appendix---Time Value of Money and Standard Normal Distribution Tables	331	(7)
Index	338