Midterm Review Outline

Actuarial Science

• areas of application
• life tables
• discounting for interest and survivorship
• pension plans

• The decision environment
• Time series
• Simple forecasting procedures
• The role of loss functions
• Choosing among forecast methods

Simulation

• Reasons for simulation
• Types of simulation
• General procedure
  • specify measurements of interest
  • gather real world data
  • do the simulation
  • simultaneously collect simulation statistics
  • summarize results
• Monte Carlo simulation
  • do general procedure
  • specify random variables
  • link random numbers to random variables

Queuing Theory

• properties of the queuing environment
• structure of queuing systems
• operating characteristics
• particular types of queuing systems
• history

Decision Theory

• decisions
• states of nature
• payoff tables
• decision criteria under uncertainty
• maximizing expected value
  • when use of expected value is appropriate
  • value of perfect information
  • decision trees