Vasily Strela teaches this segment of MIT's 18.642 Topics in Mathematics with Applications in Finance, laying out the mathematics behind bonds and interest rates. He covers compound interest, discounting future cash flows, and the distinction between zero-coupon and coupon bonds, then walks through why bond prices and yields move in opposite directions. Strela introduces yield curves, surveys how their shapes have changed historically, and explains how an inverted curve can signal a coming recession. The lecture closes on duration and convexity, the two measures that quantify how sensitive a bond's price is to interest rate changes, framing them as essential tools for fixed income investing. The explanation stays grounded in formulas and worked relationships rather than abstraction, aimed at students who need to apply this math directly to pricing and risk in bond markets.