What is it about?

We conduct advanced analysis to construct a three-question math quiz in order to assess key skills needed for an introductory finance course. We begin with data collected from a ten-question math quiz given to 314 undergraduates on the first day of class. We use the analysis to determine the three best questions for predicting overall course performance. This three question assessment can explain about 10% of the undergraduate introductory course performance. The quiz holds potential within the classroom for students, instructors, and university administration to better identify math skill deficiencies relevant to finance.

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Why is it important?

The 2021 Programme for International Student Assessment shows that students in the USA trail their peers in other industrialized nations with regard to math skills. Students with finance skills typically have greater labor market opportunities than those without. This research suggests that math pays!

Perspectives

Math skills are sometimes viewed as a barrier to certain college degrees such as engineering. While the math requirements for an undergraduate in engineering are typically greater than for an undergraduate in finance, we demonstrate an explicit link between specific math skills and finance. We hope this work helps people learn about math skills that are useful in learning finance.

Matthew M Ross
Western Michigan University

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This page is a summary of: A three question math quiz: Who is ready to learn finance?, Journal of Education for Business, September 2021, Taylor & Francis, DOI: 10.1080/08832323.2021.1976713.
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