Understanding the Mathematics of Personal Finance

John Wiley, New Jersey, 2009

## Errata

### Chapter 1

Page 9, bottommost equation:

$%\mathrm{Change}=100\frac{27,000-30,000}{30,000}=100\frac{-3}{30}=-10%$

Problems:

 2a) $x+y+z=6+2+3=11$ 2b) $z\left(\mathrm{x-3}\right)\left(\mathrm{y+2}\right)=3\left(6-3\right)\left(2+2\right)=36$ 3a) $P$3=23

In the solution to problem 6, columns 3 and 4 were interchanged and then the graph (figure 16.2) of the Sale % was drawn using the erroneous data. Also, when a priced is reduced, the %Change as defined in section 1.4 on page 9 is a negative number. %Reduction is the same number without the - sign. The correct answer to problem 6 is:

Original Sale % %
Price Price Reduction Sale
$289.99$217.492575
$249.99$199.992080
$127.50$102.002080
$99.99$84.991085
$59.79$53.991590

### Chapter 2

At the top of page 30, i = 10%/12 = 0.8333%, with the same correction in footnote (2) at the bottom of the page.

The solution to pbolem5 on page 211 shows the principal to be $1,000.00. This principal as stated in the problem is$10,000.00. The rest of the solution (pages 211-212) is correct. The spreadsheet Ch2CompoundInterest.xls caused the error. This error was corrected on Feb 13, 2010. Spreadsheets downloaded before this date should be replaced with the newer version.

### Chapter 3

The solution to problem 1b on page 213 is $2,084.18,not$2,048.18.

### Chapter 6

The summary information at the bottom of Table 6.3 on page 79 should read

 ADB: $154.74$483.54 Interest: $1.33$9.14 Balance Due: $38.87$492.68 Total Due: $531.55 Problem 1(b) on page84 should read ".... receives your payment of$100 on the second day of the next ...." This is already refected in the solution on page 218.

Credit card laws (early 2010) have affected a bank's ability to direct payments to the lowest interest partof the balance. Please read credit card contracts and statements carefully. The calculations presented in this chapter are correct as shown, but the default payment allocation may now be different.

### Chapter 10

The solution to problem 2 on page 227 should be

Year q l d Cost($) PV($)
1 0.3333 100000 33,333 33,333 32,686
2 1 66,667 66,667 66,667 62,858