BODMAS basics for Quants

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One of the trickiest aspects of maths is to know in what order to perform operations within complex sums. In this article, we will show how to navigate the order of operations, also known as BODMAS.In quants, there are two types of components: the numbers themselves and the operators (also called operations) that tell you what to do with those numbers.So, in the sum 7 x 3 + 5 there are three numbers; 7, 3 and 5 and two operators, a multiplication and an addition. This sum can produce two different answers depending on which order you use the operators.If you multiply seven by three and add five, the answer is 26.But if you multiply seven by the sum of three and five (eight), the answer comes out at 56.So, how do you know in what order to proceed? Trained mathematicians know that there is a definite hierarchy of operations and a default order for performing basic arithmetical operations: adding, subtracting, multiplying and dividing).

Applying the order of operations

Regardless of the exact terminology, the sequence remains the same:

Step 1: Brackets

The highest level order is defined by anything contained in brackets. These sums are always calculated first. But what if there is more than one set of brackets? The rule then is to start at the innermost set and work outwards. Performing each bracketed calculation should leave you with a single number, allowing that set of brackets to be removed.

Step 2: Order or Index

The terms Order or Index all relate to operations containing powers or indices such as squaring or square rooting. These calculations are all performed second.

Steps 3 and 4: Divide and Multiply

The third and fourth steps, division and multiplication, have equal weight and so form a third level order of operations that are carried out at the same time. Importantly, when two or more operations of the same order appear one-after-another, the operations should be carried out from left to right.So, if faced with a sum like: 18 ÷ 6 × 4 ÷ 8 you just work from left to right. Eighteen over six is three, times four is twelve, divided by eight is 1.5.

Steps 5 and 6: Add and Subtract

Again, these carry equal weight. Therefore the addition and subtractions form the fourth and final level order of operations The third and fourth steps, division and multiplication, have equal weight and so form a third level order of operations that are carried out at the same time, again working from left to right. In summary, once you have performed all the “B” and “O/E/I” calculations, in that order, just work from left to right doing any “Ds” or “Ms” as you find them, then go back to the beginning and work from left to right on all the “A” or “S” sums. Here are a few examples to try on your own: Simplify this expression: (20-18)3/8*3-1
Choose your answer: A. 1/2 B. 2 C. 8 D. 8/23 SOLUTION: B
Simplify this expression: (2.3+1.9+3+3.7+4.1)2-1*42 Choose your answer: A. 464 B. 240 C. 14 D. None SOLUTION: B
 
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