Category Archives: Announcements

Problem Set #3 clarification…

I just received an email from a Finance 4335 student who asked the following question pertaining to Problem Set 3 (due Thursday, September 19):

Q: On question 1 in problem set #3 it states that there is a 25% probability of losing $100. Does that imply that there is a 75% probability of winning $100?

Here’s my answer:

A: In this problem there are only two possible outcomes – in the loss state, the net worths of Messrs. Moe, Larry and Curley declines from $120 to $20 with probability .25. In the no loss state, their net worths remain intact at $120 with probability .75.

Now on Netflix: ‘The Pursuit’

Foreward by Dr. Garven: This is a highly informative and compelling documentary from the American Enterprise Institute which explains how free-market capitalism has pulled two billion people out of poverty since 1970. Here’s the summary:

“Professional musician turned intrepid economist Arthur Brooks travels around the globe in search of an answer to the question: How can we lift up the world together, starting with those at the margins of society? His journey takes him through the chaotic streets of Mumbai, a town in Kentucky left behind by the global economy, a homeless shelter in New York, a street protest in Barcelona, and a Himalayan Buddhist monastery. Along the way, he discovers the secrets not only to material progress for the least fortunate, but also true and lasting happiness for all.”



AEI’s ‘The Pursuit’ is now available on Netflix. Here’s what it taught me about free-market capitalism.

Matt Winesett | AEIdeas

Since 1970, the percentage of the world’s population living on starvation’s edge has decreased by 80 percent. That’s about two billion people pulled out of poverty, over six times the number of people who currently reside in the United States.

I learned that this weekend while watching “The Pursuit,” an AEI documentary now available on Netflix that follows Arthur Brooks around the globe in search of the answer to one question: How did this happen? Read more.




Arthur C. Brooks
Former AEI President
Arthur C. Brooks is a former president of the American Enterprise Institute (AEI). He concurrently serves as a professor of the practice of public leadership at the Harvard Kennedy School and a senior fellow at Harvard Business School. He was president of AEI from January 1, 2009, to June 30, 2019.

Reminder to Apply: V&C 2019 Weekend Honors Program: Entrepreneurship & Human Flourishing

Foreward by Dr. Garven: I am forwarding an email from Ms. Kate Westrick, who is with the American Enterprise Institute. The Values & Capitalism Weekend Honors Program: Entrepreneurship & Human Flourishing, which is scheduled for November 8-10 in Austin, TX, is a fantastic opportunity and I hope that some of you will be able to participate!


Good morning,

I just wanted to send a quick reminder about the upcoming Values & Capitalism Weekend Honors Program: Entrepreneurship & Human Flourishing. This program is a fully-funded, intensive three-day seminar on business and entrepreneurship for 25 Christian undergraduate students. The program will take place from Friday, November 8 to Sunday, November 10 and will be held in Austin, Texas. The deadline is just ten days away!

Participants will take part in three core tutorials – a team-oriented problem solving exercise, a Harvard Business School case study, and a discussion about faith, personal identity, and failing by design. Students will also engage in several practicums on design thinking, business model canvassing, career design, and vocational mapping. Beyond these sessions, students will have the opportunity to hear from prominent Christian business leaders and participate in site visits to local businesses.

You can learn more about this program and apply here! The application deadline is September 23. See below for more details.

If you are a student, we encourage you to consider applying for this opportunity!

Kind regards,

Kate Westrick
Academic Programs Assistant



November 8-10 | Austin, TX

The Weekend Honors Program: Entrepreneurship & Human Flourishing is an intensive seminar on business and entrepreneurship for 25 Christian undergraduate students from colleges and universities across the country. Unlike a traditional academic seminar, the program will consist primarily of hands-on exercises that encourage entrepreneurial thinking and integrate questions of faith with business. Based in Austin, Texas, this program will take place from Friday, November 8 to Sunday, November 10.




Friday, November 8

9:00 am Welcome and Introductions

9:30 am Tutorial I, Brian Brenberg

12:30 pm Tutorial II, Brian Brenberg

3:30 pm Practicum I, Haley Robison

7:00 pm Reception & Networking Dinner

Saturday, November 9

8:30 am Practicum II, Haley Robison

11:00 am Tutorial III, Brian Brenberg

2:00 pm Site Visit I

3:30 pm Site Visit II
6:00 pm Dinner & Conversation

Sunday, November 10

9:00 am Breakfast & Closing


Application Requirements

Candidates must submit:

  • An online application
  • A letter of recommendation
  • A personal statement
  • A resume
  • A transcript

Application Deadline:

Monday, September 23, 2019

Questions? Contact Kate Westrick

Risk Pooling Class Problem and plans for tomorrow’s meeting of Finance 4335

Here is the solution for the first question in the class problem that we worked on yesterday. Please check your work against this solution, and also solve problems 2 and 3.

In problem 2, we change the composition of the risk pool by adding an additional 5 risks.  While this change does not affect the average loss per policy (see equation 1a on page 4 of the lecture outline),  it lowers the average risk per policy (equation 2a on the same page).  The lowering of average risks causes the tail probability (i.e., the probability of an average loss exceeding $1,500) to decline, which you will numerically confirm when you complete your work on problem 2.

In problem 3, we use the same number of risks (n = 10) as in problem 2, but introduce positive correlation (\rho = .1). This causes the average risk per policy to increase vis-a-vis the result shown in problem 2, which causes the tail probability to increase, which you will numerically confirm when  you complete your work on problem 3.

We’ll begin class tomorrow by finishing off the solutions to this risk pooling class problem and covering the following set of topics which appear on pp. 6-21 of the lecture outline @ (1) Making decisions under certainty, 2) Making decisions under uncertainty, 3) The expected value model, 4) The St. Petersburg Paradox, and 5) The expected utility model.

Gamma Iota Sigma Meeting tonight 8pm – Foster 203

Please come tonight to the kickoff meeting for Gamma Iota Sigma (GIS), the RMI fraternity, beginning at 8 p.m. in Foster 203. Student members of GIS are eligible to represent Baylor at the GIS national conference, and possibly other industry-related throughout the year, all expenses paid. It is an outstanding opportunity to learn more about risk management and insurance professions.  At the GIS national conference, there will be a job fair with many employers from around the country recruiting talent. Don’t miss out on this opportunity!

For more information about GIS at Baylor, go to

PSA: Active Shooter Training Video

Play the “Avoid.Deny.Defend.” Active Attack Training Video

The “Avoid. Deny. Defend.” Active Attack Training Video is sensitive in nature. The purpose of the video is not to alarm but to make sure the Baylor community is prepared in the event of an active shooter or active attack situation on campus or any other public place. If you have not viewed the video of President Linda A. Livingstone, Ph.D., and Mark Childers, associate vice president of Public Safety and Security, discussing the importance of the video, you can view it here.

After viewing the video, should you need support or someone to talk to, please contact the Baylor University Counseling Center or a member of the pastoral care team in the Office of Spiritual Life.

Baylor University Counseling Center

Pastoral Care in the Office of Spiritual Life
254- 710-3517