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Tag Archives: Puzzle
Puzzle #5 (Answer): Leaping to Conclusions
Puzzle #5: A Royal Mystery posed the following question: Gregory was born on a Monday in New York City. His father sent out Western Union telegrams to announce the birth. The family later moved to London. On his seventh birthday, … Continue reading
Puzzle #5: A Royal Mystery
Gregory was born on a Monday in New York City. His father sent out Western Union telegrams to announce the birth. The family later moved to London. On his seventh birthday, which was also a Monday, the boy saw the … Continue reading
Puzzle #4: Bond Pricing
Here’s another puzzle I’ve used to teach bond math. It’s not hard, but it requires some understanding of bond concepts that I will explain as we go (I beg the patience of bond mavens). Suppose you are the financial advisor … Continue reading
Posted in Bonds, Fun, Math, Puzzles
Tagged Bond Math Puzzle, Callable Premium Bonds, Finance Math Puzzle, Financial Math, Math, Price to Call, Price to Maturity, Puzzle, Puzzle #4, Yield to Maturity
12 Comments
Puzzle #3: A Better Answer
Puzzle #3 asked for the weighted average life (“WAL”) of the principal payments for a 30year mortgage that is cut short by a balloon payment at 15 years. The following information was provided: $100,000 Principal; 5% Interest Rate; $536.82 Level … Continue reading
Posted in Fun, Math, Puzzles
Tagged Average Life Formula, Cool Graphs, Finance Math Puzzle, Financial Math, Math, Puzzle, Puzzle #3, Weighted Average Life
5 Comments
Puzzle #3: Mortgage with Balloon
Puzzle #1 posed the question: given a $100,000 mortgage at 5% with monthly payments of $536.82 for 30 years, what is the average life of the principal payments? The puzzle was to be solved with just a few simple calculations. … Continue reading
Posted in Fun, Math, Puzzles
Tagged Average Life Formula, Bond Math Puzzle, Finance Math Puzzle, Financial Math, Math, Puzzle, Puzzle #3, Weighted Average Life
22 Comments
Puzzle #2: Answers to Followup Questions
Puzzle #2 asked how a $6 million mortgage pool with a weighted average LTV of 80% could have a total property value of $9 million when the average LTV implies a value of $7.5 million. Chun Lee NG gave a good general … Continue reading
Posted in Fun, Math, MortgageBacked Securities, Puzzles
Tagged Cool Graphs, Finance Math Puzzle, Financial Math, Puzzle, Puzzle #2, Weighted Average LTV
2 Comments
Puzzle #2: Followup Questions
Puzzle #2 asked how a $6 million mortgage pool with a weighted average LTV of 80% could have a total property value of $9 million when the average LTV implies a value of $7.5 million. Chun Lee NG provided a good explanation … Continue reading
Posted in Fun, Math, MortgageBacked Securities, Puzzles
Tagged Finance Math Puzzle, Financial Math, Puzzle, Puzzle #2, Weighted Average LTV
1 Comment
Puzzle #2: Weighted Average LTV
The loantovalue ratio (“LTV”) of a mortgage equals the loan amount divided by the property’s value. The LTV is a key indicator of mortgage quality. The lower the LTV, the more likely it is that the mortgage can be paid off … Continue reading
Posted in Fun, Math, MortgageBacked Securities, Puzzles
Tagged Finance Math Puzzle, Financial Math, Puzzle, Puzzle #2, Weighted Average LTV
12 Comments
Puzzle #1: Epilogue
Puzzle #1 posed the question: given a $100,000 mortgage at 5% with monthly payments of $536.82 for 30 years, what is the average life of the principal payments? The puzzle was to be solved with just a few simple calculations. … Continue reading
Posted in Bonds, Fun, Math, Puzzles
Tagged Bond Math Puzzle, Finance Math Puzzle, Financial Math, Puzzle, Puzzle #1, Weighted Average Life
7 Comments
Answer to Puzzle #1
The answer to Puzzle #1 is now visible as a comment from Ron Page under the original post. Ron has provided the only correct answer so far (he’s missing a pair of parentheses, but it’s clear what he means). His … Continue reading
Posted in Fun, Math, Puzzles
Tagged Bond Math Puzzle, Finance Math Puzzle, Financial Math, Puzzle, Puzzle #1, Weighted Average Life
4 Comments