BBA 112 Mathematical Analysis
Uploaded by
Emmanuel BwalyaBBA 112 Mathematical Analysis
Uploaded by
Emmanuel BwalyaZAMBIAN OPEN UNIVERSITY
SCHOOL OF BUSINESS STUDIES
MODULE: BBA 112
Mathematical Analysis
Aim
The course aims to provide an introduction to mathematical concepts and lay down a foundation
for applications of basic tools and techniques for various areas of business such as economics,
accountancy and the life and social sciences. It begins with non calculations topics as Basic
mathematics, equations, functions, matrix algebra, mathematics of finance etc. Then it progress
through both single-variable and multi-variable calculus. An abundance and variety of
applications appear throughout the course. Students continually see how the mathematics they are
learning can be applied to practical business problems. These applications over such diverse areas
as business, economics, sociology, finance etc.
Objectives
At the end of the module you should be able to;
Understand the use of most simple statistical techniques used in the world of business;
Understand published graphical presentation of data;
Present statistical data to others in graphical form;
Summarize and analyze statistical data and interpret the analysis for others;
Identify relationships between pairs of variables;
Make inferences about a population from a sample;
Use some basic forecasting techniques;
Use a statistical software package (optional at the discretion of the lecturer).
Course Outline:
1.0 Set Theory
1.0 Equations and inequalities
Mathematical modeling, operations expressions, factorizing, fractions, linear
equations, quadratic equations. Linear inequalities, non-linear equations,
absolute value, applications of equations and inequations.
2.0 Functions and Graphs
Definition of a function, special functions, combination of function, plotting
functions in rectangular co-ordinates, inverse functions, transformations.
3.0 Types of Functions
3.1 The Straight line and Applications
Demand, Supply, Cost, Revenue, Translations, Elasticity Of Demand, Supply
And Income Budgeters And Cost Constraints.
3.2 Simultaneous Equations
Solving simultaneous linear and non-linear equations, equilibrium and break-even,
consumer and producer surplus. The national income model and the ISLM model,
Linear programming, (LP),
formulating the problem, graphical solutions to (Lp), graphical sensitivity analysis.
3.3 Non-Linear functions and Applications
Quadratic, cubic and other polynomial function, exponential function, logarithmic
functions, hyperbolic functions.
4.0 Matrices
Definition, matrices as stores of data, organizing and handling business data,
matrix addition, subtraction, scalar multiplication, matrix multiplication, method of
reduction, inverse, determinant, Cramer’s rule, inverse using the adjoint, input-
output analysis, markov-chains transition matrices, probability matrices and how
they apply to problems such as market shares of goods and graph theory.
Assessment
This module will be assessed on 50% continuous assessment and another 50% of a written
examination at the end of the semester.
Recommended Textbooks
1. Introductory Mathematical Analysis for Business, Economics, and the Life and
Social Sciences, Ernest F Haeussler, Jr, Richard S Paul.
2. Mathematics for Economics and Finance Methods and Modeling, Martin Anthony
and Norman Biggs.
3. Essential mathematics for Economics and Business, Teresa Bradey and Paul
Patton.
4. Calculus for Business and Economics, Tailoka F P
5. Mathematical Analysis for Business, Economics, and the Life and Social
Sciences, Jagdish C Arya and Robin W Lardner.
6. Essential Mathematics for Economics, 2nd Edition, J Black and J F Bradley.
Introduction to the Module
Welcome to Module BBAC 312, Business Data Analysis. This course is designed to provide an introduction
to statistical methods useful for analyzing data, with specific application to problems of business and
economics. The methods examined, however, have general application to a wide range of data analysis.
Each of the Seven (7) units in the module has been designed as a building block, where the concepts you
learn in one unit will enable you to understand the material you work through in the next. By the end of this
course, you will have a strong grasp on the major issues that face statisticians and business data analysts.
You will also be able to apply the formal principles you learn to real world problems.
Aim
This course is designed to provide an introduction to statistical methods useful for analyzing data, with
specific application to problems of business and economics. The methods examined, however, have general
application to a wide range of data analysis
Objectives
At the end of the module you should be able to;
Understand the use of most simple statistical techniques used in the world of business;
Understand published graphical presentation of data;
Present statistical data to others in graphical form;
Summarize and analyze statistical data and interpret the analysis for others;
Identify relationships between pairs of variables;
Make inferences about a population from a sample;
Use some basic forecasting techniques;
Use a statistical software package (optional at the discretion of the lecturer).
UNIT ONE
SET THEORY
At the end of this unit you should be able to do the following:
Define set, element, ellipsis, finite set, infinite set, empty , Venn diagram, intersection,
union, subset, proper subset, equivalent sets, universal set, disjoint, set – builder notation,
complement.
Identify basic set notation which indicates whether an object is, or is not an element of a
set
List a set as null using proper notation
Describe the procedure for drawing and labeling a Venn diagram to represent the
intersection and union of two sets as well as subset
Read and write sets using set builder notation
Examine the union of disjoint sets, overlapping sets, and subsets through Venn diagrams
Examine the logical and visual relationship between a set and its complement using Venn
diagrams.
Definition
1. A set is a well defined collection of objects. By well defined, we mean there should be
no confusion as to the objects within the set.
2. The objects that form the set are called elements or members.
Notation
1. We will denote sets by capital letters. A , B , C and so on.
2. We will denote members of the set by lower case letters; a, b, c and so on.
3. There are basically two ways of representing sets and these are;
i. Listing of Elements
Example 1
A a, b, c
B {1, 2,3,...}
A is finite and B is infinite
ii. Set Builder Notation
In general set A may be defined as;
A { x / x satisfies certain properties}
This is read as the set of all x such that x satisfies these properties of A .
Example 2
A {x / x is a whole number}
0,1, 2,3,...
B { y / y is a perfect square}
1, 4,9,16,...
1. Sets which can be listed using are called discrete sets.
2. Sets in which it is impossible to list are called continuous sets.
Example 3
i. All the sets we have seen so far are discrete.
ii. C {x x is between 1 and 0} is a continuous
{x 0 x 1}
0,1
iii. D { y 0 y 1} 0,1
Both discrete and continuous maybe represented on the number line.
1. Discrete appear as dots
2. Continuous appear as solid lines.
Example 4
i. A 1, 2,3,8
ii. B 0, 2
iii. C 0, 2
iv. D 0, 2
In set builder notation, we have;
A x x 1, 2,3,8
B y 0 y 2
C x 0 x 2
D y 0 y 2
Special Sets
1. The Universal Set
The set of all things under discussion at any given time is called the universal set,
denoted by U or E .
2. The Empty Set
The set that contains no elements is called the empty set, denoted by or . Note
that the set is not empty because it contains an empty set. or
(singleton set) .
3. Subsets
To every element of a set A also belongs to a set B , we say that A is a subset of B or
B contains A or A is contained in B . We denote A as a subset of B as A B .
a. If B has more members than A , we write A B .
b. If A may have the same number of elements as B , we write A B .
Example 5
i. A a, b, c B a, b, c, d , then A B
ii. A a, b, c B a, b, c , then A B
iii. A 0,1 B 0,1 , then A B
iv. A 0,1 B 0,1 , then A B
v. A 0,1 B 0,1 , then A B
means is not a subset.
Set Operations
With numbers we can add, subtract, multiply, divide and so on. Addition, subtraction
and multiplication are called operations.
Sets behave like numbers. They have their own operations called Union, Intersection
and Complementation.
Union
If A and B are sets, then their union is a set defined by A B {x x A or x B or
x A and B }. = Union.
Example 6
1. A 1, 2 B 2,3
A B 1, 2,3
2. A 1, 2 B 1, 2
A B 1, 2 .
3. A 0, 2, 4, 6,...
B 1,3,5, 7,...
A B 0,1, 2,3,...
Set operations may also be represented using the Venn diagram. The Universal set is
represented by a rectangle and other sets (subsets) of the Universal are represented
as circles.
U
A B
The shaded part represents the Union.
4. u U
Intersection
If A and B are two sets then the intersection of A and B is a set defined by
A B {x x A AND x B}
Example 7
1. Let A 0,1 and B 0,1
A B
2. Let A 0, 2, 4,6,8,...
B 4,8,12,16, 20,...
A B B
A
B
U =
3. Let A a, e, i, o, u
B a, b, c, d , e, f , g
A B a, e
A B
U= .b
.i .a .c
.e .d
.o
.u .f .g
4. A 0,1,3,5,...
B 2, 4,6,8,...
A B
There are three (3) cases
A B
U=
A B
A B
A B is shaded
A
U=
B A B B
Complement
The complement of a set A denoted by A ’ or A is a set of elements in the
Universal set U that do not belong to A . We write A ’ = A
{x x U and x A}
U
A U A U A'
Example 8
1. Let U 0,1, 2,...
A 2, 4, 6,...
A' U A
0,1,3,5,...
2. Let U 0, 2
A 0,1
A ' 0 1, 2
Let B 0, 2
B ' 0, 2
Equality of Sets
Two sets A and B are equal if and only if every element in A is an element of B and
every element in B is an element of A . We write A B . To prove that A B we follow
two steps:
1. Show that A B
2. Show that B A
3. 1 and 2 imply A B
Laws
De Morgan’s Laws
Rules that relate on how the union, intersection, complementation of two sets
interacts are De Morgan’s laws. Let A and B be two sets, then
1. A B ' A ' B '
2. A B ' A ' B '
Proof (sketch)
L.H.S R.H.S
U A B U A B
A B ' is shaded A B ' is shaded
Example 9
Prove (2) of De Morgan’s laws
A B ' A ' B '
U 0,1, 2,...,10
A 4,9
B 5, 6, 7,8
Verify the above law.
L.H.S 1. A B 4,9 5, 6, 7,8
4,5, 6, 7,8,9
A B ' 4,5, 6, 7,8,9
0,1, 2,3,10
U A B
U A B '
R.H.S A ' 0,1, 2,3,5, 6, 7,8,10
U A
U A'
B ' 0,1, 2,3, 4,9,10
U B
U B'
A ' B ' 0,1, 2,3,...,10
Hence: A B ' A ' B '
2. Let U 0,1
A 0.5,1
and B 0,0.8
Verify A B ' A ' B '
L.H.S A B '
1
A B ,1 0, 0.8
2
1
, 0.8
2
A B ' 0,
1
0.8,1
2
R.H.S A ' 0, 0.5 1
B ' 0 0.8,1
1
A ' B ' 0, 1 0 0.8,1
2
1
0, [0.8,1]
2
Hence A B ' A ' B '
Associative Laws
Let A , B and C be sets
The associative law is defined by:
(i) A B C A B C
(ii) A B C A B C
These two laws say that it does not matter the order in which you intersect three sets or
unite three sets the result will always be the same.
Distributive Laws
Let A , B and C be 3 sets. Then the Distributive laws are:
(i) A B C A B A C
(ii) A B C A B A C
Example 10
Let A 1, 2
B 2,3
C 2,5
Verify 1.6.2
L.H.S R.H.S
A B 2 B C 2,3 2,5
A B C 2 (2,5} 2
2 A B C 1, 2 2
2
L.H.S = R.H.S
L.H.S R.H.S
A B 1, 2 2 1, 2,3 B C 2,3 2,5
A B C 1, 2,3 2,5 2,3,5
1, 2,3,5
AB C
1, 2 2,3,5
1, 2,3,5 Hence L.H.S = R.H.S
Intervals on the Real Number Line
Intervals are subsets of real numbers R . They correspond to the line segments on the real number
line. There are 9 types of intervals. Each one is represented in the interval relation below. Let a
and b real numbers, such that a b .
Interval notation Set Description Example
a, b x R / a x b 2 x3
a, b x R / a x b 2 x3
a, b x R / a x b 2 x3
a, b x R / a x b 2 x3
a, x R / x a x2
a, x R / x a x2
,b x R / x b x3
,b x R / x b x3
, R Set of real numbers) x
Example 11
If A 1,3 , B 2, 6 , C 3, 6 and the universal set x 0,10 . Find each of the following sets
and display it on the number line.
(i) C'
A B
'
(ii)
(iii) B C
A B
'
(iv)
(v) AB C
X C A B
'
(vi)
Solutions
(i) C ' 0.3 6,10
(ii) A B 1,3 2, 6
1, 6
A B 0,1 6,10
'
(iii) B C B C'
2, 6 0,3 6,10
2, 6 0,3 2, 6 6,10
B C 2,3 6
A B
'
(iv)
A B 1,3 2, 6
2,3
A B 0, 2 3,10
'
(v) AB C
1,3 2,3 1,3 6
2,3
2,3
X C A B
'
(vi)
X C A B
' ' '
X C A B
' '' '
C A B '
C A B '
3, 6 1,3 0, 2 6,10
0, 2 6,10
Activity
1. If A 2,3, 4,5 , B 2, 4, 6,8 , C 3, 4,5, 6 and the Universal set X 0,1, 2,...,10.
(a) Find i. A B ii. ( A B ) ' iii. ( A B ) '
iv. A ( B C ) v. ( X C ) ' ( A B) vi. B '
(b) Using the same sets above, confirm
i. The Associate laws:
( A B) C A ( B C ) and
( A B) C A ( B C )
ii. The Distributive laws:
A ( B C ) ( A B) ( A C ) and
A ( B C ) ( A B) ( A C )
iii. The De Morgan’s laws:
( A B) ' A ' B ' and
( A B) ' A ' B '
2. If A=(2,4], B=[3,7], C=(4,7) and the universal set X [0,10] . Find each of the following
sets and display it on the number line.
(i) C ' (ii) ( A B ) ' (iii) B C
iv) ( A B) ' v) A ( B C ) vi) ( X C ) ' ( A B)
3. (a) If A B then simplify if possible
i. A B ii. A ' B ' iii. A B '
(b) Simplify the following
i. [ X ' (Y Z )]' ii. Y ( X Y ) iii. ( X Y ) ( X Y ')
(c) If A and B are disjoint, i.e. A B , then simplify the following if possible.
i. A ' B ' ii. ( A B ) '
4. Using Associative and Distributive properties of union and intersection of sets, derive
the following:
(a) X ( X Y ) ( X Y ')
(b) X Y ( X Y ) ( X Y ') ( X ' Y )
(c) X (Y ' Y ) X Y
(d) X ( X Y ) X
5. Using set notation to describe each of the following shaded sets in the diagram below:
UNIT TWO
SETS OF NUMBERS
At the end of this unit, you should be able to do the following:
1. Define common types of numbers including the set of integers, whole, natural, rational,
irrational, real, imaginary and complex
2. Recognize that the common types of numbers listed above are infinite sets
3. Define i
4. List or describe all elements in a given set written with set – builder notation
5. Classify a set given in set – builder notation as well as all or part of a set of numbers (integers,
whole, natural, rational, irrational, real imaginary or complex numbers)
6. Explain why i squared is equal to negative one
The following are sets we are familiar with;
Real Numbers
A real number is a number which can be represented by an infinite decimal
expansion.
Example 1
1
1. 0.500000...
2
2. 3.141592654...
3. 10 10.00000...
Some Real numbers have decimal parts which repeat
Example 2
1. 2.121212... 2.12
2. 3.14555 3.145
Rational Numbers
A rational number is a real number such that when expressed in decimal form, its
decimal part either terminates or repeats.
Example:
1
0.5
2
If the decimal part terminates zeros can be added to make it infinite. We normally
a
represent rational numbers in form . Quite often there will be to express the
b
a
rational number in the form into a decimal expansion form o vice versa.
b
Example 3
a
In the following problems, find the form of the given decimal expansions.
b
a. 3.2
b. 3.12
c. 3.34
Solutions
In general, the solution requires the movement of the decimal point in such a way
that we remain with the repeating part after the decimal point.
a. Let a 3.2
Multiply by 10 both sides to get
10a 32.2
Subtract from
10a a 32.2 3.2
9a 32 0.2222... 3 0.222...
9a 32 3
9a 29
29
a
9
b. Let 3.12
Multiply by 10 to get
10a 31.2...(i)
Multiply (i) by 10 to get
100a 312.2...(ii )
Subtract (i) from (ii)
100a 10a 312.2 31.2
90a 312 31
90a 281
281
a
90
c. Let a 3.34...(i)
Multiply by 100 to get
100a 334.34...(ii )
Subtract to get
100a a 334.34 3.34
99a 334 3
99a 331
331
a
99
Irrational Numbers
A real number whose decimal part does not terminate or repeat is said to be an
a
irrational number. In that case we cannot express the number in form .
b
Example 4
i) 2
ii) But there is a rational number very close to it which we often use
instead.
The symbol is called a radical sign. We use it to indicate a non negative square
n
root. is used to indicate the non negative nth root. Real numbers of the form
n
a are called radicals or surds. Quite often we are required to prove that a
particular number is an irrational number.
Example 5
To prove that 2 is irrational we need to show that it cannot be expressed in the
a
form .
b
Proof:
p
Suppose 2 is rational, then 2= … (i) where paid q are in their lowest terms.
q
p and q are integers.
2
2 p
i) Square both sides 2
q
p2
2
q2
2q 2 p 2 …. (ii)
ii) Says p 2 is divisible by 2 and using the theorem above we know that p is
divisible by 2. i.e.
p 2m , where m is an integer. Substituting this result in (ii) yields
2q 2 p 2 2m 4m2 so 2q 2 4m2
2
q 2 2m 2 … (iii)
2
iii) Says q is divisible by 2 using the same theorem. This is a contradiction
because we said p and q have no common factors. Therefore, 2 cannot
be rational. It is irrational.
Rationalisation
Certain radicals can be made simple by transforming the denominator into a
rational number. This process is referred to as rationalizing the denominator.
Example 6
i) Show that 1+ 2 is irrational
3
ii) Rationalize
1 2
Solution:
p
i) Let 1 2 , p and q are integers in their lowest terms.
q
p pq d
2 1 ; d and q are integers.
q q q
d
So is rational while 2 is irrational is a contradiction 1+ 2 is
q
irrational.
3
ii) To rationalize . Multiply numerator and denominator by 1 2 to
1 2
get:
3
3 1 2
1 2 1 2 1 2
33 2
=
2
2
12
33 2
=
1 2
33 2
=
1
= 3 3 2
An Important Property
Real numbers have several properties. One such property says, a real number p
can be negative, positive or zero. We express this property as:
p p0
p 0 if p 0
p p0
p is sometimes referred to as the absolute value.
Example 7
i) 5 5
ii) 0 0
iii) 5 5 5
Activity
Question One
(a) In a single Venn diagram, illustrate the relationship between the sets of Natural
numbers N, integers Z, rational numbers Q, irrational numbers I, and real numbers R.
1 1
(b) Let A {4, , 2, 0.3, , 0.3, 2,3} . List the elements of the following subsets of
4 3
i. Natural numbers ii. Integers (iii) Rational numbers
iv. Irrational numbers v. Real numbers
Question Two
Express the following as fractions
i. 0.85 iv. 1.666…
ii. 0.23 v. 9.423
iii. 2.13 vi. 4.357
Question Three
(a) Show that 1 2 is irrational.
(b) Show that a + b is irrational if a is rational and b is irrational.
(c) Find an irrational number which lie between
i. 2 and 3 ii. 19 and 19.01
Complex Numbers
We have so far dealt with sets and real numbers we will now study a different type
of numbers called complex numbers.
Pure Imaginary Numbers
The square root of negative number such as 1, 5 , or 9 is called a pure
imaginary number. Since by definition, 5 5 1
9 9 1
It is convenient to introduce the symbol i 1 then
5 i 5 5i
9 i 9 9i
We will adopt i 5 on 3i as the standard form for these numbers.
Properties of i
(i) i 2 1
(ii) i 3 i 2 .i i
i 4 i 2 i 1
2 2
(iii)
(iv) i5 i
The use of the standard form simplifies the operations on pure imaginaries and
eliminates the possibility of certain common errors.
Example:
Simplify
1. 9 4 2. 9 4
(3i )(2) (3i )(2i )
6i 6i 2
6
A Complex Number
A complex number has the form a ib ' a ' is called the real part. ib or bi is
called the imaginary part. The ' ' sign says the real part and the imaginary part.
There are a number of ways of representing a complex number. The form a ib is
called the standard form. If a ib c id then a c and b d .
Examples:
i) 2 '2 0i '
ii) 3i 0 3 i
1 i
iii) 2 i 2
2 2
UNIT FIVE
EQUATIONS AND INEQUALITIES
At the end of this unit, you should be able to do the following:
Solve simple equations in one variable
Solve simple rational and radical equations in one variable
Solve linear equations and inequalities in one variable.
Solve systems of linear equations in two or three variables using substitution and
elimination
Solve systems of non – linear equations in two variables using substitution and
elimination
Factorizing Algebraic Expressions
Some of the common patterns in factorizing expressions are
(a) Difference of two squares
a 2
b2 a b a b
(b) Sum and difference of cubes
x3 y3 x y x 2 xy y 2
x3 y3 x y x2 xy y 2
Examples
Factorize completely
(i) 9 x 2 y 2 64
3xy 82
2
3xy 8 3xy 8
(ii) x3 8
x 3 23
x 2 x2 2x 4
Simplify completely
2 x3 54
(i)
x 2 3x 9
2 x 3 27
x 2 3x 9
2 x 3 33
x 2 3x 9
2 x 3 x 2 3x 9
x 2 3x 9
2 x 3
7 y
(ii)
y 2 49
7 y
y 2 72
7 y
y 7 y 7
y 7
y 7 y 7
1
y7
Equations and Equalities
Equations contain one or more variables e.g. 2x 3 8
5 y 2 9 y 2 0, 2 x 5 y 2, 2 x 2 11x 2 4 x 5 0
The numbers that satisfy the equation are called solutions or roots of the equation. The following
equality properties are useful in solving equations.
Properties of Equality
For all real numbers a, b and c
(i) a a reflexive property
(ii) If a b the b a symmetric property
(iii) If a b and b c then a c transitive property
(iv) If a b then a c b c
(v) If a b then ac bc
Linear Equations
A linear equation in the variable x takes the form ax b 0 where a and b are real numbers
and a 0 .
Examples
(a) Solve 2x 3 7
2x 7 3
2x 4
x 2
(b) 4 n 2 3 n 1 2 n 6
4n 8 3n 3 2n 12
4n 3n 8 3 2n 12
n 5 2n 12
n 2n 12 5
1 n 17 1
n 17
x 1 x 2 2
(c)
4 6 3
3 x 1 2 x 2 2
12 3
3x 3 2 x 4 2
12 3
x 1 2
12 3
3 x 1 24
3x 3 24
3x 24 3
3x 21
x7
(d) The average of the salaries of Kelly, Renee and Nina is K20,000 a year. If Kelly earns
K4,000 less than Renee and Nina’s salary is two thirds of Renee’s salary. Find the salary
for each person.
Solution
Let Kelly k , Renee r and Nina n
(i) k r n 20, 000
(ii) r k 4, 000
2
(iii) n ra
3
From (ii) k r 4, 000 b
Substitute a and b in (i)
2
r 4, 000 r r 20, 000
3
8 4, 000
r 20, 000
3 3
8
r 4, 000 60, 000
3
8
r 60, 000 4, 000
3
8
r 64, 000
3
3
r 64, 000
8
r K 24, 000
3
By (ii) n 24, 000
8
n K16, 000
By (b) k 1 4, 000
k 24, 000 4, 000
k K 20, 000
Quadratic Equations
A quadratic equation in the variable x takes the form
ax 2 bx c 0
Where a, b and c are real numbers and a 0 . Quadratic equations can be solved by
(i) Factorization
(ii) Quadratic formula
(iii) Completing the square
Factorization is used when the quadratic expression has factors otherwise we use the quadratic
formula or completing the square method.
Example 1
Solve x 2 x 2 0
Solution
x2 x 2 0
x2 2x x 2 0
x x 2 1 x 2 0
x 1 x 2 0
x 2 0 or x 1 0
x 2 or x 1
Example 2
Solve 6 x 2 11x 10 0
Solution
6 x 2 11x 10 0
6 x 2 15 x 4 x 10 0
3x 2 x 5 2 2 x 5 0
3x 2 2 x 5 0
2 x 5 0 or 3x 2 0
5 2
x or
2 3
Example 3
2
1 25
Solve x
3 9
Solution
2
1 25
x
3 9
1 25
x
3 9
1 5
x
3 3
1 5 1 5
x or x
3 3 3 3
4 5 1 6
x or x
3 3 3 3
x 2.
Completing the Square
x a k where a and k
2
To use this method we rewrite the quadratic expression in the form
are constant. This is done by adding an appropriate constant term to the quadratic expression in
order to have a perfect square.
i.e. x 1 x 2 2 x 1
2
when finding the constant i.e. 6
x 3 x2 6x 9
2
x a x 2 2ax a 2
2
Note that the constant is the square of the co-efficient of the x term divided by 2 i.e.
2
coefficient
2
Example 1
Solve by completing the square
x2 4 x 2 0
x 2 4 x 2
x 2 4 x 22 2 22
x2 4 x 4 4 2
x2 2
x 2 2
x 2 2 or x 2 2
Example 2
Solve by completing the square
2 x 2 3x 6 0
1
2
2 x 2 3x 6 0
3
x2 x 3 0
2
3
x2 x 3
2
2
3 3 3
x x 3
2
2 4 4
2
3 9
x 3
4 16
2
3 57
x
4 16
3 57
x
4 16
3 57
x
4 16
3 57 3 57
x or x
4 4
The Quadratic Formula
Completing the square to solve the general quadratic equation
ax 2 bx c 0 gives the quadratic formula
ax 2 bx c 0
b c
x2 x 0
a a
b c
x2 x
a a
2 2
b b c b
x x
2
a 2a a 2a
2
b b2 c
x
2 a 4a 2 a
b b2 4ac
2
x
2a 4a 2
b b 2 4ac
x
2a 4a 2
b b 2 4ac
x
2a 2a
b b2 4ac
x
2a
Examples
Consider the two examples above
Example 1
x2 4 x 2 0
a 1, b 4, c 2
b2 4ac
x b
2a
42 4 1 2
4
2 1
16 8
x 4
2
4 8
x
2
4 4 2
x
2
4 2 2
x
2
x 2 2
x 2 2 or x 2 2
Example 2
2 x 2 3x 6 0
a 2, b 3, c 6
b b2 4ac
x
2a
3 32 4 2 6
x
2 2
3 9 48
x
4
3 57
x
4
3 57 3 57
x or x
4 4
The number b 2 4ac is called the determinant of the quadratic equation. It can be used to
determine the nature of the solutions, as follows:
1. If b 2 4ac 0, the equation has two unequal roots
2. If b 2 4ac 0, the equation has one real solution
3. If b2 4ac 0, the equation has two complex roots.
b2 - 4ac > 0
y
b - 4ac = 0
y
b2 - 4ac < 0
y
Determine the nature of the solutions and solve each of the following
Example 1
x2 2 x 5 0
a 1, b 2, c 5
b2 4ac 22 4 1 5 24
b 2 4ac 0
Hence the equation has two real solutions.
x2 2 x 5
x 2 2 x 12 5 12
x 1 6
2
x 1 6
x 1 6
x 1 6 or x 1 6
Example 2
4 x 2 20 x 25 0
a 4, b 20, c 25
b2 4ac 20 4 4 25 0
2
the equation has only one real root
4 x 2 20 x 25 0
4 x 2 10 x 10 x 25 0
2 x 2 x 5 5 2 x 5 0
2 x 5 2 x 5 0
2x 5 0
5
x
2
Example 3
3x 2 5 x 4 0
a 3, b 5, c 4
b2 4ac 5 4 3 4 0
2
the equation has two complex roots
3x 2 5 x 4 0
5 4
x2 x 0
3 3
5 4
x2 x
3 3
5 4 5
2 2
5
x x
2
3 6 3 6
5 4 25
2
x
6 3 36
5 48 25 5 23
2 2
x x
6 36 6 36
5 23
x
6 36
5 23
x
6 6
5 i 23 5 i 23
x or x
6 6
Quadratic equations can be used to solve other types of equations e.g. those involving radicals or
higher or lower powers of x
Example 1
Solve 2x 1 x 3 1
Solution
2x 1 x 3
2 2
2x 1 1 x3
2x 1 2 2x 1 1 x 3
2x 2 2x 1 x 3
2x x 3 2 2x 1
x2 6x 9 8x 4
x 2 13x x 13 0
x x 13 1 x 13 0
x 13 or x 1
Check:
x 13 5 4 1
x 13
Example 2
Solve x 4 8 x 2 12 0
Solution
Let x 2 y
x 4 8 x 2 12 0
x
2 2
8 x 2 12 0
y 2 8 y 12 0
y 6 y 2 0
y 6 or y 2
x 2 6 or x 2 2
x 6 or x 2
Check:
x 6 : 36 48 12 0
x 2 : 4 16 12 0
Roots of Quadratic Equations
It is often useful to obtain information about roots of an equation without actually solving it.
The equation whole roots are and may be written as
x x 0
x 2 x x 0
x2 x 0 ---------------------- (1)
Suppose that and are also roots of the equation
ax 2 bx c 0
ax 2 bx c
0 -------------------------------- (2)
a a a
From (1) and (2)
b
a
c
a
Generally, the x sum of roots x product of roots 0
2
Examples
1. Write down the sum and product of the roots of
5 x 2 11x 3 0
Solution
5 x 2 11x 3 0
5 x 2 11 3
x 0
5 5 5
11 3
x2 x 0 let and be the roots then,
5 5
11
5
3
5
2. The roots of the equation x 2 4 x 5 are and . Find values of
1 1
(i)
(ii) 2 2
Solution
x2 4 x 5 0
4
5
1 1
(i)
4
5
4
5
(ii) 2 2 (sum of squares of roots)
2 2 2
2
( )2 2 2 2
4 2 5 2 2
2
16 10 2 2
2 2 26
OR
and are roots
2 4 5 0
2 2
2 4 5 0
2 2 4 4 10 0
2 2 10 4 4
10 4
10 4 4 26
The roots of the equation 3x 2 5 x 1 0 are and . Find an equation whose roots are and
.
Solution
x 2 Sum of roots x product of roots 0
3x 2 5 x 1 0
5 1
x2 x 0
3 3
5
3
1
3
2 2
Sum: product: 1
2
2
19
x2 x 1 0
3
2
5 1
2
3
3
OR 3 x 2 19 x 3 0
1
3
25 6 3
9 1
19
3
Inequalities
Solutions of inequalities are usually intervals. There are three types of intervals.
Type of interval set Interval notation
1. Open interval x / x a a,
x / x b , b
x / a x b a, b
2. Half – open interval x / x aa,
x / a x ba, b
x / a x b a, b
x / x b , b
3. Closed interval x / a x ba, b
The following properties are useful in solving inequalities, for all real numbers a, b and c
(i) If a is greater b, a b then a c b c
(ii) If a b and c 0 then ac bc
(iii) If a b and c 0 then ac bc .
Examples
1. Solve 3x 4 8 and graph the solution
Solution
3x 4 8 s.s x / x 4 or 4,
3x 8 4
3 x 12
3 3
x4
2. Solve 5 x 1 10 and graph the solution
Solution
5 x 1 10 set notation: x / x 1 or 1,
5x 5 10
5x 10 5
5 x 5
5 5
x 1
3. Solve 6 2x 1 6 and graph the solution
Solution
7 5 7 5
6 2x 1 6 set notation: x / x or ,
2 2 2 2
Add 1 through out
5 2 7
x
2 2 2
5 7
x
2 2
7 5
x
2 2
Quadratic Inequalities
Quadratic inequalities involving quotients are solved by dividing the number line into regions.
Examples
1. Solve and graph the solutions for each of the following
(i) x2 2 x 8 0 set notation: x / x 4 or x 2
x 2
4 x 2 x 8 or
x x 4 2 x 4 0 , 4 2,
x 4 x 2 0
x 4 or x 2
x 4 or x 2 .
2. 2x x 6 0
2x2 x 6 0
2x x 2 3 x 2 0
2 x 3 x 2 0
3
x 2 or x
2
3 3
s.s x / 2 x or 2,
2 2
x 1
3. 0
x2
x 1, x 2
Solution set x / x 1 or x 2 or , 1 2,
x2
4. 3
x4
x2
3 0
x4
x 2 3 x 4
0
x4
x 2 3 x 12
0
x4
14 2 x
0
x4
2 7 x
0
x4
x 4, x 7
s.s x / x 4 or x 7
, 4 7,
Absolute Values
To solve equations and inequalities involving Absolute values we use the following
properties
- For any real number k 0 if x k then x k or x k if k 0
- x k then k x k
- If the absolute value x k then x k or x k
Examples
1. Solve 5 x 3 7
Solution
5x 3 7
5x 3 7 or 5x 3 7
5x 7 3 or 5x 7 3
5 x 10 5x 4
5 5 5 5
4
x 2 x
5
2. Solve 2 x 1 7
Solution
2x 1 7
7 2x 1 7
6 2x 8
3 x 4
s.s x / 3 x 4 or 3, 4
3. Solve 3x 2 1
Solution
3x 2 1
3x 2 1 or 3x 2 1
3x 1 or 3x 3
1
x or x 1
3
x2
4. Solve 2 and graph the solution
x 1
Solution
x2
2
x 1
x2 x2
2 or 2
x 1 x 1
x2 x2
2 0 or 20
x 1 x 1
x 2 2 x 1 x 2 2 x 1
0 or
x 1 x 1
x 2 2x 2 x 2 2x 2
0 or
x 1 x 1
x 4 3x
0 or 0.
x 1 x 1
2x 1
5. Solve 3
x3
Solution
2x 1
3
x3
2x 1 2x 1
3 and 3
x3 x3
2x 1 2x 1
0 3 and 3 0
x3 x3
3 x 3 2 x 1 2 x 1 3 x 3
and 0
x3 x3
3x 9 2 x 1 2 x 1 3x 9
and 0
x3 x3
5x 8 x 10
0 and 0
x3 x3
8
x 3 or x
5
And x 10 or x 3
8
x 10 or x
5
Example
Find the set of values of x for which
(a) 2 x 1 4 x 3 Note: Inequality sign changes as we are dividing by
2x 1 4x 12 negative sign ve
2x 4x 12 1
2 x 11
2 2
11
x
2
(b) 5 x 2 2 2 x 7
5x 10 4x 14
5x 4x 14 10
x 24
x 1 1 x 4 x4
3
(c) 1
x 1 4 x
3 1
0 x 1
x 1 1
3 1 x 1
0 Quotient
x 1
4 x
0
x 1
1 4
Critical values
4 x 0 Solution Set x R,1 x 4
x 4
x 1 0
1 1
x4 x 1
x 3 x 3
(d)
x 1 x 1
x 3 x 3
0
x 1 x 1
x 3 x 1 x 3 x 1
0
x 1 x 1
x 2 4 x 3 x 2 4 x 3
x 1 x 1
4x 3 4x 3
x 1 x 1
8x
x 1 x 1
Critical values
x 1, x 1, x 0
x 1 1 x 3 3 x 1 x 1
4 4
x 1
x 1
8x 6
Quotient
1 3
4
1
Solution Set is X R, x 1, or 3 4 x 1
UNIT SIX
FUNCTIONS AND GRAPHS
At the end of this unit you should be able to do the following:
Define a relation and function
Determine whether a relation represents a function
Find the value of a function
Find the domain and range of a function
Form the sum, difference, product, quotient and composite of two functions
Identify the graph of a function
Sketch the graph of basic functions
Determine if a function is even or odd or both from the graph and the equation
Determine if a function is one – to – one
Find the inverse of a one – to – one function, determine its domain and range and
sketch its graph
Relations
Definition: A relation f from set A to B is a subset of the set A B where
A B {a, b : a A, b B} the set A is called the domain of the relation f and set B is
called the range of the relation f .
Example
1. Let A 1, 2,3 B 3, 4
Then
R1 1,3 , 1, 4 , 3, 4 is a relation from A to B .
B
A
2. Let A 0,1 and B 1
R x, y x A, y B
1 1 A
0
Some Facts
i. If the two sets consist of real numbers the relation is called the real valued
relation.
ii. The domain for a relation may consist of the entire set A or subset of A .
iii. The range depends on the domain and the definition of the relation.
iv. Various notations are used to express a relation.
Example:
R1 1,3 , 1, 4 , 3, 4
R2 1,3 , 1, 4 , 3, 4
v. Diagrams are also used to display relations in the example above
A R1 B
1 3
3 4
4
3
B 2
1
1 2 3 4
A
*in R1 the domain is DR1 1,3
*the range is the set RR1 3, 4
p
vi. f p, q / q 5, 0 p 10 and P is real}
2
0
10
-5
A 10,0 B 0, 5
Example
A relation which has a domain defined only for a finite number is called discrete. A relation for
which the domain is an infinite is called a continuous relation.
Types of Relations
1. Many - to - One
This type of a relation maps many elements from A to one element in B .
a) A B Many – to – one.
1 3
2
3 4
b) 4 A 2,3
B B A
1 2 3
A
2. One – to – Many
This type of relation maps one element from A to many in B .
f1 2,3 , 2, 4
a) Graph
A B
1 3
2
4
3
4
B 3
2 A
A 2
B 3, 4
R: A B
Or R a, b / a 2,3 b 4
3. One – to – One
A relation is called a one – to – one relation if each element from A is mapped to
distinct element in B .
a) Graph
1 3
2 4
b) 4
1 2 3
A 1, 2
B 3, 4
h x, y /1 x 2and 3 y 4
4. Into – Relation
If the range of a relation, say Rf is a proper subset of B then the relation f is
said to be into.
A B
Rf
E.g.
A F B
1 3 Domain of f is a A
2 4 Range of f is 3, 4 CB
5
f is INTO.
3
5. Onto – Relations
If f is a relation from A to B and Rf is the range of f then f is onto if Rf B .
A R B Range; Rf B
Domain; Df A
Example:
Find the range given the following relations.
a) R : y 3x 5 domain X / x is real}
b) R : m 4x 15 domain { X /15 X 250, x Z }
Solutions:
a) f R Rf y
f : f x y
3x 5 y
yR
y 3x 5
y 5 3x x
y 5
x
3
Clearly from the diagram and the analytical expression the Rf is the whole R .
b) The relation m 4x 15 is also a straight line except that we pick integer
values. The domain is 16,17,..., 249
15 x 250
The minimum value in the range
min 4 16 15 49
Maximum value is
max 4 249 15 981
Range is
Rf 49,53...981
-15 (0,15)
Functions
Definition: A function is a special case of a relation and is defined as follows:
A relation f from A to B is called a function. f : A B if and only if (iff) for every
x A.
f x B . A is called the domain of f and R f x / x A is called the range of
f .
NOTES
1. A x A not have an image in B
2. The range f x B must be unique (one and only one).
Example
(i) f is a function
A f B
(ii) R is not a function but each x A has an image in B
A f B
(iii) It is a function a) each x A has a unique image in B
b) each has a distinct
A f B
(iv) f is a function from a, b A to B c, d
d
B
c
a b
A
(v) f is a function but not 1-1
B f(x)
x1 x2
A
(vi) h is not a function because some values of x have more than one
image in B .
B h
a b
Types of Functions
Odd and Even Functions
Any function for which f x f x is called an even function.
i.e. f x f x 0
Example
(i) f x x2
f 3 f 3 9
(ii) g:x x
g 3 g 3 3
g 1 1 1 g 1 1
g x x 1 x
1 x x g x
Generally the function f x x n has the property that f x f x for even values of n .
Any function for which f x f x fx f x is called an odd function e.g.
f : x x i.e. f 1 1 f x , f x x f x
f 1 1
g : x x3 , g 1 1 1 g 1 , g x x3 g x
3
Generally the function f : x x n has the property f x f x for the odd values of n .
Examples
Show that the function f x 2 x3 x is an odd function: f x f x property of odd
functions.
f x 2 x x
3
2x 3 x
f x
g x 3x 2 x 2 even powers
g 1 3 x x
4 2
3x 4 x 2
h x x2 x
h x x x neither odd or even.
2
i.e. f x f x 0
f x f x x x
2
x2
f x
a) If f is a function from A to B then f is said to be an odd function
f x f x x is in the domain
e.g. f x x x R
f x x x
Graphically, the two functions look as shown:
[𝑓(−𝑥) + 𝑓(𝑥) = 0]
y
-x
f(x)
x
-y
b) f x ax c is called a linear function
c) f x c is called a constant function
f is parallel to x - axis .
d) f x ax 2 bx c is a quadratic function
f(x)
e) f x aebx is called an exponential function.
f) f x ax where and are constant is called POWER function.
g) f x a1 x n a1 xn1 a1 x n2 is called a polynomial
P x
h) f x where P x and q x are functions such that q x 0 is called a
q x
rational function.
i) f x g x is called a modular function.
Composite Functions
If we combine functions we obtain a function called a composite function. g takes x from the
domain and maps it into the range Rg and f takes y from Rg and maps it into its range Rf .
Definition:
Let f and g be real valued function, where f is defined on some domain Df
and g is defined in Rf (Range : ff ). The composite of f
1. f on g is defined as fog x
2. g on f is defined as gof x
Example:
Let f x x 6, x R
and g x x 3, x R
2
find
(i) fof
(ii) fog
(iii) gof
(iv) gog
Solutions:
(i) fof x f y where y f x
y6
f x 6
x 6 6
x 12
(ii) f gx f g x
f y
y6
x2 3 6
x2 9
(iii) gof x
g f x
g y
x 6 3
2
x 2 12 x 36 3
x 2 12 x 39
Domain and Range
Domain:
A function f from A to B is simply a rule. It picks a real number x from A and applies the
rule. If the domain is not stated, we assume, the whole R to be the domain. However, if then
is an x in for which the rule does not make sense then that x is excluded from R . The
remaining set is called the domain.
Example:
1
1. Find the domain of f x
x 1
2. Find the domain of f x x
Solution:
1
1. f x is a rational function
x 1
Clearly the denominator cannot be zero. So x 1 0 implies x 1 . Therefore x 1
Domain of f x . The domain of f x is x / x R, x 1 .
2. f x x
x if x 0
x if x 0
x if x 0
x2
Since x x 2 then every x qualifies. Therefore the domain is .
Range
1. The range is the set of integer of x thought we denote it as Rf .
2. To determine the range, we may have to plot the function. Use analytical methods
Example:
Find the range for 𝑓(𝑥) = 𝑦
1
1. f x
x 1
𝑥
2. f x x
Solution:
1
1. y clearly the range
x 1
1 y x 1 0
1 xy y y / y Ry 0
1 y xy
1 y
x
y
2. f x x
x2 clearly the domain is . The range
x / x 0
or y / y 0; y
Analytical approach:
y x2
y0
2
-2
The range is y / y 0; y
3. Let f x 2 x 2 find;
(i) Domain
(ii) The range.
Solutions:
(i) f x 2 x2
What we seek is
0 2 x2
x2 2
x 2
2
x 2
x 2 (i) or x 2 (ii)
Equation (ii)
x 1 1 2
x 2
2x 2
The domain for f x is Df x / 2 x 2
(ii) Maximum value for f x 2 02
2
Minimum value for f x 2 2
2
22
0
0
The range is y / 0 y 2 .
−√2 √2
g x x2 2
0 x2 2
2 x2
2 x
2
2 x
2 x
x 2
Inverse Functions
Suppose that f from A to B is a function f : A B where f x y x A, y B . Can we
find a function. f 1 called the inverse of f whose domain is the range of f and its range is
the domain of f Definition
1. The inverse of a function f from A to B is again a function if and only if f is
(a) 1 – 1 (one – to – one)
(b) ONTO
2. 1 – 1 means if f x f x2 then x1 x2 .
Example:
f 1,3 , 2,1 , 3, 2
Determine
(i) The domain
(ii) The range
(iii) Whether f is 1 – 1
(iv) Whether f is ONTO
(v) The inverse
(vi) fof 1
Solution:
(i) Df 1, 2,3
(ii) Rf 1, 2,3
(iii) f is 1 – 1
(iv) f is ONTO
(v)
A B
f f-1
1 1 1
2 2 2
3 3 3
f 1 1, 2 2,3 3,1
(vi) fof 1 x f f 1 x
f f 1 1 f 2 1
f f 1 2 f 3 2
f f 1 3 f 1 3
Example 2:
Let f x x where 0 x 2 .
2
Determine
(i) Range
(ii) Whether f is 1 – 1
(iii) Inverse of f if it exists.
Solution
Min f x 0 0
2
(i)
Max for f x f 2 2 4
2
Rf y / 0 y 4
The range
(ii) Suppose f x1 f x2
x12 x2 2
x12 x2 2 0
x1 x2 x1 x2 0
Either
x1 x2 0
x1 x2 0
x1 x2 0 x1 x2
0r x1 x2 0 x1 x2 0
So f is not 1 – 1
(iii) Let y x 2
1
So y 2 x
yx
f 1 y y
Example 3:
Determine whether f x x 2 2 x 2 has an inverse or elsewhere.
Solution:
Is f x 1 – 1
f x1 f x2
x12 x2 2
x12 x2 2 0
x1 x2 x1 x2 0
Either
x1 x2 0 or x1 x2 0
x1 x2 x1 x2
Since it is possible to get f x1 f x2 when x1 x2 f is not 1- 1.
x1 1; x2 1
x1 x2 but
f 1 12 1
f 1 f 1
The range is y / 0 y 4
Domain x / 0 x 2
Range x / 0 y 4
f(x)
-2 2
UNIT SIX
LINEAR FUNCTIONS:
At the end of this unit, you should be able to do the following:
Obtain the different forms of the equation of a linear function
Identify from any form of the equation of line its slope and intercepts
Solve application problems involving linear functions
An equation of the form
y x mx c is called a linear function, if it is written in the form mx c 0 ,we
say we have a linear equation.
1. f x 3x 6 } function
y 3x 6 } equation
The graph of a linear function is a straight line.
𝑙1
𝑙3
𝑙2
Some Definitions
A linear function, y x mx c is sometimes written as
y ( x) mx c …(i)
y mx c … (ii)
ay bx c 0 …(iii)
In general
m is called the slope or gradient or rate
c is called the y - intercept. The straight line asses the y - axis at o, c .
Example:
Graph the solution of the following equations
(i) 2 x 1 0
(ii) y 4 2
(iii) x y 1 0
Solution:
(i) 2x 1 0
1 1
x 𝑥 = −2
2
0
1
−2
(ii) y4 2
y6
𝑦=6
(iii) x y 1
y x 1
𝑦
−1
−1
Properties
We can obtain the equation of straight line if;
1. We are given two points x, y and x1 , y1
y1 y0
m
x1 x0
y1 y0 m x1 x0
y mx1 mx0 y1
y mx c; c y1 mx1
2. We are given a slope m and a point on the line x, y .
y y0 m x x0
y mx y0 mx0
y mx c
Example:
Find the equation of a straight line given;
(a) P 2,1 Q 3, 4 as points on the line
point 2, 3
1
(b) Slope
2
Solution:
4 1 3
(a) m 3
3 2 1
P
Q
y y0 3 x x0
y 4 3 x 3
y 4 3x 9
y 3x 9 4
y 3x 5
(b) y y0 m x x0
1
y 3 x 2
2
x 2
y3
2 2
x
y 3 1
2
x
y 1 3
2
x
y 2
2
2 y x 4 or 2 y x 4 0
Parallel Lines
If we have two lines L1 ; y m1 x c1 and L2 ; y m2 x c2 then L1 and L2 are parallel if m1 = m2 .
𝑙2
𝑙1
C2
C1
Example:
Find the equations of parallel lines one passing through 1, 2 and the other 3, 4 with slope
1 .
Solution:
y y0 m x x0 passing through 1, 2
y 2 1 x 1
y 2 1 x 1
y 2 x 1
y x 1 2
y x 1... (i)
y 4 1 x 3
y 4 x 3
y x 3 4
y x 7... (ii)
1
Perpendicular Lines
1
If L1 and L2 are as defined in 2.5.3 then L1 and L2 are perpendicular if m1m2 1 or m2
m1
Example:
passing through A 2, 4
1
Find the equation of a straight line perpendicular to y x 2 x
2
B 0,0 origin.
Solution:
1
a) y x 2 x
2
Point 2, 4
Equation:
y y0 m x x0 m is such that; m1m2 1
1
y4 x 2 2m 1
2
x 1
y 4 1 m
2 2
x
y 1 4
2
x
y 3
2
2y x 6
2y x 6 0
b) P 0,0
y y0 m x x0
y mx
x
y
2
2y x
2y x 0
UNIT SIX
APPLICATION OF LINEAR FUNCTIONS TO DEMAND, SUPPLY, COST AND REVENUE.
Demand and supply decisions by consumers, firms and the government determine the level
of economic activity within an economy.
At the end of this unit, you should be able to do the following:
Define supply and demand analysis and explain its function
Explain how supply an d demand are relationships between the price of a product and the
quantity of the same product
Define and explain the difference between demand and quantity demanded
Define and explain the law of demand
Define and explain the difference between normal goods and inferior goods
Provide examples of products that are generally considered to be inferior goods and to be
normal goods
Illustrate and explain how an increase in income decreases the demand for an inferior
good and how an increase in income increases the demand for a normal good
Define and explain the difference between substitutes and complementary goods
Illustrate and explain how the demand for a product increases when the price of a
substitute good increases
Illustrate and explain how the demand of a product increases when the price of a
complementary good decreases
Define and explain the difference between supply and quantity supplied
Define the law of supply.
The Demand Function
There are several variables that influence the demand for a good X. These may be expressed
by the general demand function
Q f ( P, Y , Ps , Pc , T . A, . . .)
where
Q is the quantity demand for good X
P is the price of good X
Y is the income of the consumer
Ps is the price of substitute goods
Pc is the price of complementary goods
T is the table or fashion of the consumers
A is the level of advertising
Definition
A substitute good is one that can be used instead of another good, e.g. trains and buses.
A complementary good is one that is consumed in conjunction with another, e.g petrol/cars
compact disc and stereo system or hifi system.
The demand function P g (Q ), can be modeled by the simple linear equation.
P a bQ, where a and b are constants. This is the equation of a straight line.
The Supply Function
There are several variables that influence the supply of good X .These may be expressed by
the general supply function.
Q f ( P, C , Po , T , N , O, . . .)
where
Q is the quantity supplied for good X
P is the price of good X
C is the cost of production
Po is the price of other goods
T is the available technology
N is the number of producers in the market
O is other factors, e.g. tax/subsidies
The simplest model for the supply function is written as Q f (P) , that is, quantity supplied
depend on price only, so long as the other variables upon which supply depends remain constant.
The equation of the supply function can be modeled by the simple linear equation..
P cdQ where c and d are constants c 0.
Example 1
The demand function is given by given by the equation P 100 0.5Q .
a) State and give a verbal description of the slope and intercepts.
b) What is the quantity demanded when P 5?
c) Plot the demand function P 100 0.5Q for 0 Q 200.
d) Find an expression for the demand function in the form Q f (P) and graph it.
Solution
P
a) The vertical intercept is 100. This mean P = 100 when Q = 0. The slope 0 .5 .
Q
This indicates that the price drops by 0.5 units for each successive unit increase in quantity
demanded.
b) The quantity demanded when P = 5 is calculated by substituting P = 5 into the
demand function
P 100 0.5Q
5 100 0.5Q
0.5Q 100 5
0.5Q 95
95
Q 190.
0.5
c) To plot the demand function over the range 0 Q 200, choose various quantity values
with this range.
Demand Schedule Supply Schedule
0 100 0 10
40 80 40 30
80 60 80 50
90 55 90 55
120 40 120 70
160 20 160 90
200 0 200 110
100 a = 100
80 Slope = - b = - 0.5
60 P = 100 – 0.5Q
40 D 𝑎
= 200
𝑏
20
0 40 80 120 160 200 240 Q
d) The demand function, Q f ( P ) is derived as follows:
P 100 0.5Q
0.5Q 100 P
Q 200 2 P
250 𝑎 1
𝑄= − 𝑃
Vertical
200 𝑏 𝑏
𝑄 = 200 − 2𝑃
Intercept, 150
𝑎
= 200 1
𝑏
100 𝑠𝑙𝑜𝑝𝑒 = = −2
𝑏
50 D
0 20 40 60 80 100 P
Horizontal intercept, Q = 100
Example 2
The supply function is given by P 10 0.5Q
a) State and verbally describe the slope and intercepts.
b) Plot the supply function, P 10 0.5Q for 0 Q 100.
Solution
a) The vertical intercept is c = 10. This means that the term will supply no units at
P
P 10 . The slope 0.5. This means that price increases by 0.5 units for
Q
every successive unit increase in quantity supplied.
The horizontal intercept is calculated by substituting P 0 into equation of the
supply function, that is,
P 10 0.5Q
0 10 0.5Q
10 0.5Q
10
Q q 20.
0.5
Therefore, the horizontal intercept is at (Q 20, P 0) is not economically
meaningful.
b) To plot the supply function over the range 0 Q 100, choose various quantity values
within this range.
Supply Schedule
Quantity Price
0 10
20 20
40 30
60 40
80 50
100 60
80
70
P = 10 + 0.5Q
60
50
40
Slope = 0.5
30
20
C = 10
10
-20 0 20 40 60 80 100 Q
Definition
Cost:
Firms incur costs when they employ inputs such as capital and labour, in order to produce goods
for sale on the market. The total cost of producing a good will normally consist of :
i) Fixed costs, FC: Costs that are fixed irrespective of the level of output, e.g. rent on
premises.
ii) Variable costs, VC: Costs which vary with the level of output, e.g. extra unit of a
good produced will require additional units of raw materials, labour etc.
Total cost, therefore, is the sum of fixed costs and variable costs.
TC FCVC
iii)
Revenue.
A firm receives revenue when it sells output. The total revenue TR, received is the price of the
good, P, multiplied by the number of units sold, Q, that is TR = PQ.
Elasticity of Demand, Supply and Income
Price elasticity of demand – measures the responsiveness (sensitivity) of quantity demanded to
changes in the good’s own price.
% Qd
d = Percentage change in quantity demanded =
% P
Percentage change in price
Q P Q2 Q1 P1 1
. E 100
P Q Q1 P2 P1 100
Q P
P Q
P1
P2
Q1 Q2 Q
Negative sign associated with d indicates the direction and magnitude of the responsiveness of
one variable with respect to another. A negative sign indicates than an increase in one variable is
accompanied by a decrease in the other or vice versa. A positive sign indicates that an increase
(decrease) in one is accompanied by an increase (decrease) in the other.
There is a convention in some economics textbooks to give the numerical value of elasticity
without the sign. This is known as the absolute value or magnitude of elasticity, , which only
indicates the magnitude of the responsiveness of one variable to a change in another and not the
direction of the responsiveness.
Point Elasticity of Demand
Given the linear demand function, P a bQ then the formula for point elasticity f demand at
any point ( Po , Qo ) is
Q Po
d . or
P Qo
1 Po Q 1
d Since .
b Qo P b
where d is the coefficient of elasticity of demand.
Arc Price Elasticity of Demand
An elasticity of demand measure the elasticity of demand over an interval on the demand function.
Instead of using the price and quantity at a point as in point elasticity, arc elasticity uses the average
of the price and quantities at the beginning and end of the stated interval.
1
( P P )
Q 2 1 2 Q P1 P2
d . . .
P 1 (Q Q ) P Q1 Q2
1 2
2
d 1 elastic inelastic elastic d 1
1 0 1
Coefficient of Price Elasticity of Demand
There are three categories of price elasticity.
i) Elastic: d 1
Demand is strongly responsive to changes in price; that is; the percentage change in demand
is greater than the percentage change in price.
ii) Unitary elastic: d 1
The percentage change in demand is equal to the percentage change in price.
iii) Inelastic: 1 d 0
Demand is weakly responsive to changes in price; that is, the percentage change in
demand is less than the percentage change in price.
Loosely speaking, for a given percentage change in price, there is a greater percentage change in
quantity demanded if demand is elastic, a smaller percentage change is demand is inelastic, and
an equal percentage change if demand has unit elasticity.
Income Elasticity of Demand
Income elasticity of demand measure the responsiveness of quantity demanded to changes in
income. Arc-price elasticity formula for the income elasticity of demand measures the
percentage change in quantity demanded divided by the percentage change in income. It is
written as
y = Percentage change in quantity demanded
Percentage change in income
%Q
%Y
Q Y1 Y2
y
Y Q1 Q2
where:
Y1 = initial level of income
Y2 = new level of income
Q1 = initial level of demand
Q2 = new level of demand
The coefficient of income elasticity of demand may be positive or negative.
Coefficient of income elasticity Type of good
Positive income elastic y 1 Normal (luxury)
Unit income elastic y 1 Normal
Positive income inelastic 0 y 1 Normal (Necessity)
Negative income elastic y 0 Inferior
Inferior goods y 0 0 Normal good y 0
Example 3
A firm has fixed production costs of K35,000 and variable production costs of K7 000 per
unit produced.
a) Write down the equation of the total cost function.
b) Graph the total cost function.
Solution
a) FC K 35,000, VCK 7000Q
Therefore TC 35 000 7 000Q
b)
Example 4
Suppose that each chicken snack box is sold for K12 250.00 irrespective of the number of
units sold.
a) Write down the equation of the total revenue function
b) Graph the total revenue function.
Solution
a) Total revenue is price multiplied by the number of units sold, that is
TR 12,250Q
Note that price is constant at K12,250 irrespective of the value of Q.
b)
Total Revenue
Q TR PQ = 12,250 Q Point ( Q, TR )
0 TR = 12,250 (0) = 0 (0, 0)
1 TR = 12,250 (1) = 12,250 (1, 12,250)
2 TR = 12,250 (2) = 24,5000 (2, 24,500)
3 TR = 12,250 (0) = 36,7500 (3, 36,750)
Example 5
Given the demand function for computers as P 2400 0.5Q .
a) Determine the coefficient of point elasticity of demand when
i) P 1500 , and ii) P 1000 . Give a verbal description of each
result.
ii) If the price of computers increases by 12%, calculate the percentage change
in the quality demanded at
b) If the price of computers increases by 12%, calculate the percentage change in the
quantity demanded at:
i) P 1500 and ii) P 1000 .
Solution
a) i) When P 1500, Q ?
1500 2400 0.5Q
0.5Q 2400 1500 500
90
Q 1800.
0.5
The value of point elasticity of demand at (Q = 1800, P = 1500) is calculated by
substituting these values along with b = 0.5 into the formula.
1 Po 1 1500 5
d 1 / 67
b Qo 5 1800 3
d 1.67 indicates that at the price P = 1500 a 1% increase (decrease) in price
cause a 1.67% decrease (increase) in the quantity demanded of computers.
ii) At P 1000, the quantity of computers demanded, Q is calculated as
1000 2400 0.5Q
1400 0.5Q
Q 2800.
The point elasticity of demand at (Q = 2800, P = 1000) with b = 0.5 is
1 Po
d
b Qo
1 1000 5
0.71
0.5 2800 7
d 0.71 indicates that the price P = 1000 a 1% increase (decrease) in price will cause a 0.71%
decrease (increase) in quantity demanded of computers.
c) The calculation of the exact percentage change in Q requires basic arithmetic. Start by
calculating the new price which results from an increase of 12% on the initial price.
112
Increase P 1500 by 12% Pnew P 1.12(1500) 1680.
100
Then calculate the corresponding values of Q from the equation of the demand function.
When P = 1500, Q =- 1800 and when P = 1680, Q = 1440.
d) Initial New P, Q Percentage change in Q
1440 1800
P : 15000 (1.12 1500) 1680 100 20%
1800
Q : 18000 Q 4800 2(1680) 1440
2560 2800
P : 1000 1.12 1000 1120 100 8.57%
2800
Q : 2800 Q 4800 2(1120) 2560
Alternatively once can use the definition
% Qd
d = percentage change in quantity demanded =
% P
percentage change in price
We may have to rearrange the formula e.g.
i) (%Q) (%P) d ii) %Q 12(0.71) 8.52%.
%Q 12(1.67) 20.04
Example 6
Given the demand function for silicon chips, P 12 0.5Q, where P is the price of Silicon
chips for each batch of 1000, calculate the coefficient of point elasticity of demand when:
a) P0
b) P4
c) P6
d) P8
e) P 12
Solution
1 Po
d
b Qo
b 0.5
Coefficient of point elasticity of demand for silicon chips.
Price P Quantity, Q Coefficient of point elasticity of demand,
0 24 0
4 16 0.5
6 12 1
8 8 2
2 0
Example 7
The demand function for a good A is given by Q 20 000 2PA 2PB 0.6Y .
Where PA is the price of good A, PB is the price of a substitute good B and Y is income.
Calculate the coefficient of income elasticity of demand when income increases from K280
000 to K420 000, assuming that prices are fixed at PA 140 000, PB 210 000.
Solution
Since prices are fixed at PA K140,000, PB K 210,000, then quantity is a function of
income only that is, Q f ( y ) . Therefore, the demand function can be written as
Q 20 000 2 PA 2 PB 0.6Y
Q 20 000 2(140 000) 2(210 000) 0.6Y
Q 20 000 280000 420 000 0.6Y
Q 160 000 0.6Y
Y1 Y2
Q1 160000 0.6(280 000) Q2 160 000 0.6(420 000)
328000 412000
The coefficient of income elasticity is calculated by substituting the income and quantity
values.
Q Y1 Y2
y .
Y Q1 Q2
412000 328000 420000 280000
.
410000 280000 328000 412000
84 700
0.568
140 740
Since the coefficient of income elasticity is 0.568, good A is a normal good and is income
inelastic.
Budget and Cost Constraints.
A budget constraint (or budget line), retales the amount of goods that a consumer can afford
to purchase to his or her income and prices. Consider a consumer who spends all his or
her income, M on two goods, referred to as X and Y, price at PX and PY per unit
respectively. The consumer can choose to spend his or her income on
i) a combination of Y and Y
ii) All X and no Y.
iii) All Y and no X
The general equation for budget constraint is given by M xPX yPy
A cost constraint, also known as an isocost (equal cost) line, relates the amount of inputs
that a firm can afford to purchase given its total allowable expenditure (budget) and the
cost per unit of the inputs. Assume that the inputs are labour, L, and capital, K, the cost
per unit of labour is the wage rate, (w), the cost per unit of capital is rent ®, while the firm’s
total allowable expenditure is C.
A firm can allocate its expenditure on:
i) a combination of L and K
ii) all L and no K
ii) all K and no L
Equation of the isocost line. The general function for the isocost line is given by
wL rK C.
Example 8
A consumer has an income M K 630 000 to spend on good X, whose price is
PX K10 500 and good Y, where PY K 21 000.
a) Write down the equation of the budget constraint; hence state the value of slope
and intercepts.
b) Write down the equation of the budget constraints which result when each of the
following changes are introduced. Describe the relationship to the original
constraint in (a).
i) PX K 5 250 while PY K 21000 and M K 630 000 remain the same).
ii) Py K 10 500 while ( PX 10500) and M K 630 000 remain the same).
iii) P K10 500 , PY K 21 000 remain the same but income change to
M K 840 000 .
Graph the original constraints with each of the constraints (i), (ii) and (iii)
on separate diagram.
UNIT EIGHT
POLYNOMIALS
Introduction
We have defined a polynomial previously. In this unit we are concerned with finding linear
terms for a polynomial.
A term such as x a which divides a polynomial
Pn x a0 X n a1 X n1 ...an1 X an ...
evenly is called a factor. For quadratic polynomial we can obtain factor by using two methods
discussed so far. For general polynomials we need other methods. One method is the long
division and the other is synthetic division. The latter is the preferred method.
Objectives
At the end of this unit you should be able to do the following:
Identify polynomial
Perform algebraic operations with polynomial
Find the real zeros of a polynomial
Sketch the graph of polynomial functions
Solve inequality problems involving polynomials
Solve application problems involving polynomial
Find real roots of polynomial equations using
- Fundamental theorem of algebra
- Factor and remainder theorem
- Location theorem
- Conjugate theorem
- Synthetic division
Factor and Remainder Theorem
1. If a polynomial Pn ( x ) is divided by x b until a remainder R free of x is obtained
then Pn (b) R .
2. If is a root of the polynomial equation Pn ( x) 0 then x is a factor of the Pn ( x ) .
The polynomial may be decomposed as follows:
Pn ( x) d ( x)q( x) R( x)
Pn ( x) R( x)
q( x)
d ( x) d ( x)
Notes
The polynomial Pn ( x ) is called the dividend
The denominator d x is called the divisor
The result q x is called the Quotient
R x is called the remainder.
The Remainder Factor Theorem
It will help to;
1. Factorise Pn ( x ) and solve Pn ( x) 0
2. Solve inequalities such as Pn ( x) 0
3. Plot the function.
Example 1
Determine whether x 1 is a factor of the given polynomial and if not find the remainder.
Solution: (By long division)
a) x 3 3 x 2 3 x 1
x2 4 x 7
x 1 x3 3x 2 3x 1
x3 x 2
4 x 2 3x 1
4 x 2 4 x
7 x 1
7 x 7
8 .
x 1 is not a factor.
x2 2x 1
x 1 x3 x 2 x 1
x3 x 2
2x 2 x
2x 2x
x 1
x 1
2.
x 1 is not a factor.
The remainder theorem says that instead of using long division to determine whether
x 1 is a factor. We could do the following.
Solve x 1 0
x 1
1. Plug the value of x 1 into the function.
a) P3 x x 3x 3x 1 b) P3 1
3 2
1 3 1 3 1 1
3 2
13 12 1 1
1 3 3 1 0
8 since the remainder is zero x 1 is a factor.
P3 x is the dividend
x 1 is a divisor
x 2 4 x 7 is the quotient
8 is the remainder.
Synthetic Division
We will illustrate the procedure using an example.
Example 2
P3 x x3 3x 2 3x 1
We need to determine whether x 1 is a factor.
Solution:
1. Solve x 1 0 to get x 1
2. Write down all the coefficients of Pn ( x ) in a straight line
x 2 4 x 7 is the quotient
So x 3 3 x 2 3 x 1 = x 1 x2 4 x 7 8
Example 3
Divide x 4 3 by x 2 using synthetic division
x 4 0 x3 0 x 2 0 x 3
x 2 0 x2.
x3 2 x 2 4 x 8 is the quotient and 19 is the remainder.
So x4 3 x 2 x3 2 x2 4 x 8 19 .
Exercise
1. Use synthetic method to find:
(a) P 1 when f x 2 x 3x 2 x
3 2
(b) P 2 when f x 4 x 2 x 1
4 2
2. Divide 8 x 10 x 7 x 3 by 2x 1 using
3 2
(i) Long division
(ii) Synthetic division
Finding Factors
Suppose we would like to factorise P3 x ax bx cx d
3 2
1. Multiply a and d to obtain ad .
2. Write down all possible factors of ad .
3. By try and error find one of the factors of ad whereby if you substitute its value x in P3 ( x )
you get P3 ( x) 0
4. The set of numbers you get provides roots of the polynomial.
5. Use the remainder theorem or synthetic division to determine the roots.
Example 4
Solve the following inequality 2 x 3 x 2 8 x 4 0
Solution:
1
Solution Set: x / x 2or x 2
2
Exercise
Find all rational roots of the following
(i) 2 x3 3x 2 2 x 3
(ii) Sketch the polynomial
Example 5
Solve the following equations:
(i) x3 3x 2 4 x 12 0
x4 4 x2 3 0
(ii)
Solution:
We don’t always have to use the remainder theorem the above examples illustrate that.
(i) x3 3x 2 4 x 12 0
x 2 x 3 4 x 3 0
x 2
4 x 3 0
x 2
22 x 3 0
x 2 x 2 x 3 0
x4 4 x2 3 0
(ii)
Let y x 2
y2 4 y 3 0
y2 3y y 3 0
y y 3 y 3 0
y 1 y 3 0
x 2
1 x 2 3 0
x 1 x 1 x 3 x 3 0
x 1,1, 3, 3
Example 6
Find the remainder when each of the following polynomials is divided by x 2
(a) x 4 x 2 x 5
3 2
(b) 3x x 2 x 6
3 2
(c) 4 x 7 x 13 x 20
3 2
Solutions
(a) f x x3 4 x 2 2 x 5
f 2 23 4 2 2 2 5
2
8 4*4 4 5
8 16 4 5
23
(b) f x 3x3 x 2 2 x 6
f 2 3 2 22 2 2 6
2
3 8 4 4 6
24 6
f 2 18
(c) f x 4 x3 7 x 2 13x 20
f 2 4 2 7 2 13 2 20
3 2
32 28 26 20
4 6
f 2 2
Example 7
Let x 2 be a factor of f x where f ( x) x3 x 2 Ax B .
(i) Find an equation satisfied by the constraints A and B
(ii) Given further that when f x is divided by x 3 the remainder is 10 , find a second
equation satisfied by A and B .
(iii) Find the values of A and B
(iv) Using your values of A and B solve the equation f x 0 when we say a factor of
the remainder is zero.
Solution
(i) f x x3 x 2 Ax B
f x 23 22 A 2 B x2 0
f 2 8 4 A2 B x2
f 2 2 A B 4
f 2 0
2A B 4 0
2 A B 4
(ii) x 3 0
x3
f x x3 x 2 3 A B
f 3 x 3 x 2 3 A B
f 3 33 32 3 A B
f 3 27 9 3 A B
f 3 3 A B 18
f 3 10
3A B 18 10
3A B 10 18
3A B 8
2 A B 4 1
(iii)
3 A B 8 1
2 A B 4 2 A B 4
3A B 8 2 4 B 4
A1 4
8 B 4
1 1
A 4 B 4 8
B4
(iv) f x x3 x 2 4 x 4
f x 0
x3 x 2 4 x 4 0 1 4 4
Synthetic division factors of 4 ,
1, 2, 4
13 12 4 4 0 for x 1
1 1 -1 -4 4
1 0 -4 0
x 1 x2 4 0
x 1 x 2 x 2 0
x 1 0 or x 2 0 or x 2 0
x 1 or x 2 or x 2
Example 8
Find the possible values of and k if the expression 3 x x kx 4 is exactly divisible by x 1
4 3
and leaves a remainder 18 when divided by x 2 .
x 1 0 x 1
f x 3x x3 Kx 4
4
f 1 3 K 4
f 1 K 7
f 1 0
UNIT NINE
EXPONENTIAL AND LOGARITHMIC FUNCTIONS
Exponential Functions
Introduction
In this unit, we study functions such as 5 x where x is an index or exponent. Hence 5 x is called
an exponential function and 5 is the base of the function.
Objectives
At the end of this unit, you should be able to do the following:
Evaluate expressions containing exponents
Evaluate exponential notations with exponents of 0 and 1
Write an exponential expression involving negative exponents with positive exponents
Use the product rule to multiply exponential expressions with like bases
Use the power rule to raise powers to powers
Use the quotient rule to divide exponential expressions with like bases
Solve application problems involving exponential functions
Graph an exponential function
Graph logarithmic function
Convert between logarithmic and exponential expressions
Evaluate logarithmic expression
Solve an elementary logarithmic equation
Apply the properties of logarithms
Evaluate logarithmic expressions with any base
Solve applications involving logarithms
Solve logarithmic equations.
Rules for Indices
The three basic rules are:
1) a m a n a m n
2) a m a n a m n
3) (a m )n a mn
Example 1
3 2
Find the values of (a) 100 2 (b) 32 5
3
10 1000
3
(a) 100 2
3
100
2
1 1 1 1
(b) 32 5
2
2 2 2
5
5
32 4
32
Example 2
9x
Show that (a) 32 x1 (b) 2 x 1 8x 1 42 x 1
3
1 9x
(a) 3 2 x 1
3 3 3
2x 1 2 x
3 3
2 x 1 23 x 3 24 x 2 22
x 1 x 1 x 1 x 1 2 x 1
(b) 2 8 2 2
3
42 x 1
Exponential Equations
An equation such as 5 x 125 is an exponential equation. The unknown ( x ) is the exponent. We
can solve such equations by expressing both sides in terms of the same base. Sometimes this can be
done directly. If not, a more general method using logarithms can be used which will be shown later.
Example 3
Show the equations (a) 3x 81 (b) 8 x 0.25
(a) We have to see that 81 is a power of 3 (the base of the left hand side). 81 3 so the
4
equation is 3x 34 . Both sides are now expressed to the same base, so the exponents
must be equal. Hence x 4 .
x
(b) Here we must see that 8 and 0.25 can both be expressed to base 2 .
8 x 23 23 x
x
1 1
0.25 2 22
4 2
2
Then 3 x 2 x .
3
Example 4
Solve the equation 22 x 3 1 9 2 x .
2 2 x 3 2 2 x 23 2 x 8
2
Now if we put p 2 x , then 22 x 3 8 p 2 and 9 2 x 9 p .
The equation then becomes 8 p 2 9 p 1 0 i.e. 8 p 1 p 1 0
1
Giving p or p 1 .
8
1
Then 2 x 23 and x 3
8
Or 2 1 20 or x 0 .
x
The solutions of the equation are x 3 or x 0 .
However, note that not all such equations will have two solutions or even any solution s.
Example 5
Solve the equation 22 x 1 15 2 x 8 0 .
22 x 1 22 x 21 2 x 2
2
As before, put p 2 x .
1
The equation becomes 2 p 2 15 p 8 0 i.e. 2 p 1 p 8 0 giving p or 8 .
2
1
So 2 x 21 and x 1
2
Or 2 8 . As 2 x is never negative, this part has no solution.
x
The equation has therefore only one solution, x 1 .
Example 6
Solve the equation 2 x 21 x 3 .
2
The equation is 2 x 21 2 x 3 i.e. 2 x 3.
2x
Take p 2 x .
2
The equation becomes p 3 i.e. p 2 3 p 2 0 .
p
Then p 2 p 1 0 and p 2 or 1 .
Then 2 x 2 21 and x 1 or 2x 1 20 and x 0 .
The solutions are x 1 or 0 .
Example 7
Solve the simultaneous equations
3x 9 y 1
i
22 x 4 y
1
ii
8
In equation (i), we see that each term can be expressed as a power of 3 .
Then 3x 32 30
y
So x 2 y 0
iii
Similarly, each term of equation (ii) can be expressed as a power of 2 .
Then 2 2 x 2 2 23
y
So 2 x 2 y 3 iv
1
Solving equations (iii) and (iv), we obtain x 3, y 1 .
2
Applications of Exponential Functions
Population Growth (Unlimited Growth)
Unlimited growth is modeled by the equation y (t ) aert , where a and r are positive constants.
Example 1
The population of a village was 753 in 1980. If the population grows according to the equation.
P 753e0.03t
where P is the numbers of persons in the population at time t :
(a) Graph the population equation for t = o ( in 1980) to t = 30 ( in 2010)
From the graph, estimate the population in the year
(i) 1990
(ii) 2000
(b) Confirm your answers algebraically
(c) In what year will the population reach 1750 persons?
Solution
First calculate a table of values for various times over the required interval t = o to t =30
t 0 5 10 15 20 25 30
P 753 87 486 1016.4 1180.9 1372.1 1594.1 1852.1
In 1990, t = 10 years
(b) P 753e0.03t
753e0.03(10)
1016.44
1016 (since we cannot have 0.44 persons)
In 2000, t = 20
P 753e0.03(20)
P 1372.05
1372
Graphically draw a horizontal line across from the population = 1 750.
Algebraically
As P is known, substitute P = 1 750 into the equation and solve for t .
P = 753e 0.03t
1750 = 753e 0.03t
1750
e0.03t
753
e0.03t In2.324
In2.324
t
0.03
t 28 Years
Limited Growth
Limited growth is modeled by the equation y(t ) M (1 e rt ) , where M and r are positive
constants.
Examples: Consumption functions, amount of random information which can be memorized,
sales with advertising, electrical and mechanical systems.
Example2
Limited Growth: A Consumption Function
A consumption function is modeled by the equation.
C 500(1 e0.3 y )
Graph the consumption functions over the interval 0 Y 20 . Use the graph to describe how
consumption changes as income (Y) increases.
Solution
Make a table of values to calculate C for several values of Y between 0 and 20.
Y C 500(1 e0.3 y )
0 0
4 349
8 455
12 486
16 496
20 499
The figure above relates consumption as a function of income. The shape of the graph indicates
that, as income increases, consumption increases at a decreasing rate towards an upper limit
C=500.
Logistic Growth
Logistic growth is modeled by the equation
M
y (t )
1 ae rMt
Where M , a and r are positive constants. Logistic growth is modeled in the figure below.
Examples: Consumption functions, constrained populations, growth of epidemics, sales.
The Logarithmic Function
The inverse of the exponential function is called the logarithmic function. If y a x , we define x
as the logarithm of y to the base a (a 0) . This is written as log a y.
Exponential form Logarithmic form
y ax Index becomes logarithm log a y x
8 23 Base log 2 8 3
100 10 2 log10 100 2
r a3 log a r 3
Conversely, if log x 10 4, then 10 x 4
If log 3 x 5, then x 35
The Graph of the Logarithmic Function
As the exponential function y a x , we can obtain its graph by reflecting y a x in the line y x
Note the following:
1. log a 1 0 . This follows because a 0 1
2. log a x is not defined if x 0 . The logarithm of a negative number does not exist.
3. If 0 x 1, log a x 0 . The logarithm of a positive number less than 1 is always negative.
4. log a 0 is undefined
5. As x increases, log a x increases.
6. log a a 1
Rules for logarithms
1. log a PQ log a P log a Q
P
2. log a log a P log a Q
Q
3. log a P n log a P
n
EXAMPLE 1
Simplify the following
(a) log7 49 log7 72 2log7 7 2 as log 7 7 1
1
(b) log 3 log 3 1 log 3 9 0 log 3 3
2
9
2 log 3 3
2
(c) log 4 9 log 4 21 log 4 7 log 4 9 21 7
log 4 27
log 4 33
3log 4 3
Example
Given that log 5 2 0.431 and log 5 3 0.683 , find the value of
(a) log5 6 (b) log 5 1.5 (c) log5 8 (d) log5 12 (e) log 5
Solutions
(a) log5 6 log5 3 2 log5 3 log5 2 1.114
3
(b) log 5 1.5 log 5 log 5 3 log 5 2 0.252
2
(c) log5 8 log5 23 3log5 2 1.293
(d) log5 12 log5 4 3 log5 4 log5 3 log5 2 log5
2 3
2log5 2 log5 3
1.545
1
(e) log 5 log 5 1 log 5 18 0 log 5 9 2
18
log 5 9 log 5 2
log 5 32 log 5 2
2 log 5 3 log 5 2
1.797
Example 3
Find the value(s) of x if
(a) 2log3 x log3 x 6
(b) log5 ( x 3x 2) 2 log5 x 1
2
Solutions
(a) 2log3 x log3 x 6
log 3 x 2 log 3 x 6
x2 x 6
x2 x 6 0
x 3 x 2 0
x 3 x 2
We see that x 2 is not possible as log 2 is undefined. Hence the only solution is
x 3.
(b) log5 ( x 3x 2) 2 log5 x 1 2
2
x 2 3x 2
log 5 2
x 1
Changing to exponential form,
x 2 3x 2
52
x 1
x 2 3 x 2 25 x 25
x 2 28 x 27 0
x 27 x 1 0
x 27 x 1
Now check these results
If x 1 , log5 x 1 log5 0 which is undefined so the solution is 27.
Common Logarithms
For practical calculations, base 10 is used and logarithms on this base are called common
logarithms. These are written as lg x , which is an abbreviation for log10 x .
This is another system of logarithms, called natural logarithms, written as ln x , which is used in
calculus. The base of natural logarithms is a certain number e 2.718
Example 4
Find log 2 7
Solution
If log 2 7 x , then 2 x 7
Note: We cannot express 7 as a power of 2 directly so we convert this equation to a logarithmic
equation using logarithms of base 10.
Take the log of each side
lg 2 x lg 7
x lg 2 lg 7
lg 7 by calculator
x
lg 2
x 2.81
Example 5
Find the value of x if
(a) 3x 1 2 x 1 (b) log x 6 1.5
Solution
3x 1 2 x 1
lg 3x 1 lg 2 x 1
x 1 lg 3 x 1 lg 2
x lg 3 lg 3 x lg 2 lg 2
x lg 3 lg 2 lg 3 lg 2
3
x lg lg 6
2
lg 6
x
lg1.5
4.42
(b) log x 6 1.5
x1.5 6
lg x1.5 lg 6
1.5lg x lg 6
lg 6
lg x
1.5
lg10 x 0.5188
Hence x 100.5188 3.30 using x y function.
UNIT TEN
SIMULTANEOUS EQUATIONS
Objectives
At the end of this unit, you should be able to do the following:
Solve systems of linear equations in two or three variables using substitution,
elimination and graphical methods
Solve systems of non – linear equations in two variables using substitution and
elimination
Solve application problems involving simultaneous equations
Solving Simultaneous Linear Equations
Examples
(1) Given the simultaneous equations
x 3y 4
x 2 y 6
a. Solve for x and y algebraically
b. Solve for x and y graphically
Solution
(a) x 3 y 4
x 2 6
5 y 10
y2
x 3 2 4
x6 4
x 2
(b) Graphical Method
Unique, Infinitely Many and No Solutions Simultaneous Equations
A set of simultaneous equations may have
A unique solution
No solution
Infinitely Many solutions
Unique Solution
This occurs when a set of equations has one set of values which satisfy all equations as
illustrated in Example 1.
No Solution
This occurs when a set of equations has no set of values which satisfy all equations
Example
Given the simultaneous equations
y 1 x
y 2 x
(a) Solve for x and y algebraically.
(b) Solve for x and y graphically
Solution
(a) y 1 x
y 2 x
0 1
0 1 is not possible, therefore, there is no solution.
(b) Graphical method (parallel lines)
Simultaneous Equations with Infinitely Many Solutions
Example:
Given the simultaneous equations
y2 x (1)
2 y 4 2x (2)
(a) Solve for x and y algebraically.
(b) Solve for x and y graphically
Solution
When equation (2) is divided by 2, the result is exactly the same as equation (1)
2 y 4 2x
y 2 x
2 2 2
So, equation (1) and (2) are the same. There is only one equation in two unknowns. If x is given
any value, the corresponding y - value can be calculated.
e.g. x 2 y 2 2 0
x 3 y 2 3 1
x 5 y 2 5 3 e.t.c.
There is an infinite number of x, y pairs which satisfy equations (1) and (2)
Three Simultaneous Equations in Three Unknowns
Example:
Solve the equations
2x y z 4 (1)
x yz 3 (2)
2 x 2 y z 12 (3)
Solution
Solving (1) and (2)
2 x y z 4 /1
x y z 3 /-1
2x y z 4
x y z 3
x 1
(1) and (3)
4 x 3 y 16
3 y 12
y4
z2
Applications to Equilibrium and Break-even
Goods market equilibrium (market equilibrium) occurs when the quantity demanded (Qd ) by
customers and quantity supplied (Qs ) by producers of a good or service are equal.
The equilibrium condition is expressed as
Qd Qs and Pd Ps
The Break-even point for a good occurs when total revenue is equal to total cost.
Example
The demand and supply functions for a good are given as:
Demand function Pd 100 0.5Qd
Supply function Ps 10 0.5QS
Calculate the equilibrium price and quantity algebraically and graphically
Solution
Market equilibrium occurs when Qd Qs and Pd Ps . Since the functions are
written in form P f (Q) with P as the only variable of the LHS of each equation.
Pd Ps P and Qd Qs Q
100 0.5q 10 0.5Q
1.0Q 90
Q 90.
Equilibrium quantity is 90.
P 100 0.5Q 100 0.5(90) 100 45 55.
Example
The labour demand and supply function are given as;
Labour demand function : Wd 9 0.6 Ld 7 (1)
Labour supply function : WS 2 0.4 LS 7 (2)
Calculate the equilibrium wage and equilibrium number of workers algebraically. (In this
example 1 worker = 1 unit of labour).
Solution
Labour market equilibrium occurs when Ld Ls and wd ws . Since the functions are
written in for form w f (L) equate wages, thereby reducing the system to an equation in
L only
wd ws
9 0.6 L 2 0.4 L
7L
Now solve for w by substituting L=7 onto either equation (1) or (2)
w 9 0.6(7) 9 4.2 48.
The equilibrium wage is 4.8.
Example
The demand and supply functions for a good are given by:
Demand function : Pd 100 0.5Qd
Supply function : Ps 10 0.5Q5
a) Analyze the effect of the introduction of a price ceiling of 40 in this market.
b) Calculate the profit made by black marketers of a black market operated in this
market.
Solution
a) The demand and supply functions are the same as those in Worked Example (1)
where the equilibrium price are quantity were 55 and 90 units respectively. The
price ceiling of 40 is below the equilibrium price of 55. Its effect is analyzed by
comparing the level of quantity demanded and supplied at P = 40.
The quantity demanded at P = 40 is
Pd 100 0.5Qd
40 100 0.5Q
Qd 120
The quantity supplied at P = 40 is
Ps 10 0.5Qs
40 10 0.5Qs
Qs 60
Since Qd 120 Qs 60, there is excess demand also referred to as a shortage
in the market.
b) The existence of price ceilings often leads to the establishment of black markets
where goods are sold illegally at prices above the legal maximum. Black marketers
would buy the 60 units supplies at the controlled price of 40 per unit. However, as
there is a shortage of goods, consumers are willing to pay a higher price for these
60 units. The price that consumers are willing to pay is calculated from the demand
formula from Q = 60. Substitute Q = 60 into the demand function.
Pd 100 0.5Qd
Pd 100 0.5(60) 100 30 70
So, Pd 70 is the price consumers are willing to pay.
c) Therefore, black marketeers by the 60 units at the maximum price of 40 per unit,
costing 60 x 40 = 2400. Their profit (TI) is the difference between revenue and
costs.
TI TR TC
(70 60) (40 60)
4200 2400
1800.
Example
Given the labour demand and supply function as
Labour demand function : Wd 9 0.6 Ld
Labour supply function : WS 2 0.4 LS
Analyse the effect on the labour market if the government introduces a minimum wage law
of 6 per hour.
Solution
The labour demand and supply function are the same as those in worked examples (2) where
the equilibrium wage and units of labour were 480 per hous and 7 labour units respectively.
The minimum way low (price floor) of 6 is above market equilibrium. Its effect is analyzed
by comparing the levels of labour demanded and supplied at w = 6.
Labour demanded at w = 6 is
wd 9 0;6 Ld
6 9 0.6 Ld
Ld 5.
Labour supplied at w = 6 is
ws 2 0.4 Ls
6 2 0.4 Ls
Ls 10
Ls 10 Ld 5 there is excess supply of labour of XS Ls Ld 10 5 5. This is also
referred to as a surplus, that is there is unemployment in the labour market.
Example
Find the equilibrium price and quantity for two substitute goods X and Y given their respective
demand and supply equations as:
Qdx 82 3Px Py (1)
QSX 5 15PX ( 2)
Qdy 92 2 Px 4 Py (3)
Qsy 6 32PY ( 4)
Solution
The equilibrium condition for the two goods market is
Qdx Qsx and Qdy Qsy
82 3Px Py 5 15Px
92 2 Px 4 Py 6 32Py
3Px 15Px Py 87
2 Px 4 Py 32Py 98
18Px Py 87 (5)
2 Px 36Py 98 ( 6)
Multiply equation (6) by 9 and add equation (5)
18Px Py 87
18Px 324Py 882
323Py 969
Py 3.
Substitute in equation (5) Py 3
18Px 3 87
18Px 90
Px 5
Now solve for Qx and Q y
When Px 5, Qx 5 15(5) 5 75 70.
When Py 3, Qy 6 32(3) 6 96 90
The equilibrium prices and quantities in this two goods market are
Px 5, Qx 70, Py 3, Qy 90
Example
The demand and supply function for a good are given as:
Labour demand function : Pd 100 0.5Qd
Labour supply function : PS 10 0.5QS
a) Calculate the equilibrium price and quantity.
b) Assume that the government imposes a fixed tax of 6 per unit sold.
i) Write down the equation of th supply function adjusted for tax.
ii) Find the new equilibrium price and quantity algebraically and graphically.
iii) Outline the distribution of the tax, that is, calculate the tax paid by the
consumer and the producer.
Solution
a) The equilibrium quantity and price are 90 units and 55 respectively.
b) i) Ps 6 10 0.5Q, Ps 16 0.5Q
ii) Pd Ps
100 0.5Q 16 0.5Q
Q 84
P 100 0.5(84) 58.
iv) The consumer always pays the equilibrium price, therefore the consumer
pays 58 an increase of 3 on the original equilibrium price with on tax, which
was 65. This means that the consumer pays 50% of tax. The producer
receives the new equilibrium price, minus the tax, so the producer receives
58 – 6 = 52, a reduction of 3 on the original equilibrium price of 55. This
also means that the producer pays 50% of the tax.
Example
The demand and supply function for a good (KP per ton of potatoes) are given as:
Demand function : Pd 450 2Qd
Supply function : PS 100 5QS
a) Calculate the equilibrium price and quantity.
b) The government provides a subsidy of 70 per unit (ton) sold
i) Write down the equation of the supply function adjusted for the subsidy.
ii) Find the new equilibrium price and quantity algebraically and graphically.
iii) Outline the distribution of the subsidy, that is, calculate how much of the
subsidy is received by the consumer and the supplier.
Solution
a) Pd Ps P, Qd Qs Q
450 2Q 100 5Q
350 7Q
Q 50
P 450 2(50) 350
The equilibrium rice and quantity are 350 and 50.
b) i) Ps 70 100 5Q, Ps 30 5Q
ii) 450 2Q 30 5Q
7Q 420
Q 60
P 450 29600 330.
iv) The consumer always pays the equilibrium price, therefore, the consumer
pays 330, a decrease of 20 on the equilibrium price with no subsidy (350).
The producer receives the equilibrium price, plus the subsidy (350). The
producer receives the equilibrium price, plus the subsidy, so the producer
receives 330 + 70 = 400, an increase of 50 on the original price of 350.
Example
The total revenue and total cost functions are given as follows:
TR 3Q
TC 10 2Q
a) Calculate the equilibrium quantity algebraically and graphically at the break-even
point.
b) Calculate the value of total revenue and total cost at the break-even point.
Solution
a) At break-even point
TR TC
3Q 10 2Q
Q 10.
b) TR 3(10) 30
TC 10 29100 10 20 30
Consumer and Producer Surplus
Consumer Surplus (cs). This is the difference between the expenditure a consumer is willing
to make on successive units of a good from Q 0 and the actual amount spent on Q Qo
units of the good at the market price of Po per unit.
CS OAEoQo OPo EoQo APo Eo
Producer Surplus (PS).
This is the difference between the revenue the producer receives for QO units of a good when
the market price is Po per unit and the revenue that the producer was willing to accept for
successive units of the good from Q 0 to Q Qo CS OPo EoQo OBEoQo BPo Eo
Total surplus (TS) is the sum of consumer and producer surplus.
Example
The demand and supply functions of a good (shirts) are given as:
Demand function : P 60 0.6Q
Supply function : P 20 0.2Q
a) Calculate the equilibrium price and quantity for shirt algebraically and graphically.
b) Calculate the values of consumer and producer surplus at market equilibrium.
Illustrate CS and PS on the graph in (a).
c) What is the value of total surplus?
Solution
a) P 60 0.6Q (1)
P 20 0.2Q
(2)
0 40 0.8Q
Q 50. P 60 0.6(50) 30
Consumer and producer surplus.
1
b) CS traingle APo Eo (30)950) 750
2
1
PS triangle Po BEo (10)(50) 250
2
c) Total surplus is the sum of consumer and producer surplus; therefore
TS = CS + PS = 750 + 250 = 100
The National Income Model and the IS – LM Model
National income, Y, is the total income generated within an economy from all productive
activity over a given period of time, usually one year. Equilibrium national income occurs
when aggregate national income, Y is equal to aggregate planned expenditure, E, that is
Y E (1)
Aggregate expenditure, E, is the sum of households consumption expenditure, C, firms’
investment expenditure, I, government expenditure, G, foreign expenditure on domestic
exports, X minus domestic expenditure on imports, M that is
E C I G X M (2)
Equilibrium level of national income when E C I
Initially, the model assumes the existence of only two economic agents, households and
firms operating in a closed economy (no foreign sector) with no government section and no
inflation. Households’ consumption expenditure, C, modeled by the equation C Co bY ,
where Co is autonomous consumption , that is , consumption which does not depend on
income.
C
b(0 b 1) is called the marginal propensity to consume. b MPC measure the
Y
change in consumption per unit change in income. Firm’s investment expenditure is
autonomous, I I o .
The equilibrium level of national income, Ye is a multiple of Co I o . That is
1
Ye . (Co I o ) (Co I o ) (3)
1 b
Where the multiple is
1
1 b
The multiple, , represents the expenditure multiplier.
Example
In a two sector economy, autonomous consumption expenditure, Co 50m, autonomous
investment expenditure, I o =100m and b = 0.5.
a) Determine
i) the equilibrium level of national income, Ye ,
ii) the equilibrium level of consumption, Ce algebraically
b) Plot the consumption function C Co bY , the expenditure function;
E CI o and the equilibrium condition, Y E on the same diagram. Hence,
determine the equilibrium level of national income, Ye , and the equilibrium level
of consumption, Ce .
c) Given that Y CS , determine the equilibrium level of savings. Plot the savings
function. Plot the investment function on the same diagram . Comment.
Solution
a) i) E C I Co bY I o 50 0.5Y 100 150 0.5Y .
At equilibrium, Y E
Y 150 0.5Y
0.5Y 150
150
Y
0 .5
Ye 300
The equilibrium level of national income Ye = 300.
ii) Ce Co bYe
= 50 + 0.5 (300) = 50 + 150 = 200
b) The consumption function C 50 0.5Y
The expenditure function E 150 0.5Y
Since Ce = 200, the equilibrium level of savings
Se Ye Ce 300 200 100.
The savings function S Co (1 b)Y 50 0.5Y
Equilibrium National Income with Investment.
Example
a) Given a closed two sector-economy in which C Co 0.8Y and I I o .
i) Derive an expression for the equilibrium level of national income in terms
of Co and I I o .
ii) Calculate the increase in the equilibrium level of national income when
investment expenditure increases by £10m. Verbally describe the effect on
the £10m increase in investment expenditure on Ye .
Calculate the value of the expenditure multiplier given b = 0.8.
ii) Calculate the value of the expenditure multiplier when b decreases to 0.6
Describe the effect of the decrease in the MPC (b) from 0.8 to 0.6 on the
equilibrium level of national income.
Solution
1
a) i) Ye (Co I o ) from (3)
1 b
1
Ye (Co I o ) 5(Co I o )
1 0. 8
ii) When investment expenditure increases by £10m,
I I o 10
1
Ye ( I o Co 10) 5(Co I o ) 50
1 0.8
Thus it increase national income by £50m.
b) i) b 0.8, the expenditure multiplier is
1 1 1
5
1 b 1 0 .8 0 . 2
ii) b = 0.6, the expenditure multiplier is
1 1 1
2.5
1 b 1 0.6 4
Therefore, when b increases from 0.8 to 0.6, decreases from 5 to 2.5.
That is, a decrease of 25% in b(MPC ) results in a 50% decreases in ,
hence a 50% decrease in Ye .
Government expenditure and Taxation: E CI G
The government influence the level of national income in an economy in two ways.
1) Through the level of government expenditure on goods and services; G. It is assumed
that government expenditure is autonomous (fixed), therefore G Go . Government
expenditure will increase the level of national income (for any given value of the expenditure
multiplier) through its effect on the value of the autonomous component of expenditure.
That is
1
Ye (Co I o Go )
1 b
2) Through taxation which is assumed to be a fixed fraction of income, therefore, T tY
T
where t is the marginal propensity to tax; t MPT and 0 t 1.
Y
Tax may also be a lump-sum tax.
When tax is imposed, consumption expenditure is a function of disposable income, Yd
where
Yd Y T Yd Y tY
Yd (1 t )Y
the consumption function is now written as C Co b(1 t )Y substituting in
Yd (1 t )Y . With taxes the slope of the consumption function b(1 t ) decreases; since
b(1 t ) b. The equilibrium condition is now given as
Y E CI G
Co b(1 t )Y I o Go
1
Ye .(Co I oGo )
1 b(1 t )
The expenditure multiplier with taxes is
1
1 b(1 t )
The equilibrium level of taxation is calculated from the equilibrium level of income, that is
Te tYe
Foreign Trade
The foreign trade influences the level of national income in an economy in two ways
1) Through the level of foreign expenditure non domestic exports, X. Exports are assumed
to be autonomous (fixed) and the export function is given as X X o .
1
Ye .(Co I o Go X o )
1 b(1 t )
2) Through the level of domestic expenditure on imports, M. The import function is given
as M is autonomous and m is the marginal propensity to import
M
m MPM
Y
The equilibrium condition is now given as
Y E C I G X M
Co b(1 t )Y I o Go X o M o mY
Solve for Y, the equilibrium level of national income is
1
Ye (Co I o X o M o )
1 b(1 t ) M
Expenditure multiplier with foreign is
1
1 b(1 t ) M
Example
a) Calculate the expenditure multiplier when
i) b 0.5 and t 0.1
ii) b 0.5 and t 0.2
b) i) Determine the expenditure equation and hence find the equilibrium level
of national income graphically give Co = £50m I o = £100m, Go = £0m,
b = 0.5 and t = 0.2. I o Confirm your answer algebraically.
i) Calculate the equilibrium level of taxation. Confirm your answer
graphically.
Solution
1 1 1
a) i)
1 b(1 t ) 1 0.5(1 0.1) 1 0.5(0.9)
1.82
1 1 1
ii)
1 b(1 t ) 1 0.5(1 0.2) 1 0.5(1 0.8)
1.67
The value of the expenditure multiplier decreases with an increase in the tax
rate.
b) i) The expenditure equation is
E C I o Go
Co b(1 t )Y I o Go
50 0.5(1 02)Y 100 0
E 150 0.4Y
The equilibrium level of national income is at Ye .=250 = E.
Algebraically, at equilibrium.
Y E
Y 150 0.4Y
0.6Y 150
Y 250
ii) The equilibrium level of taxation is
Te tYe
(0.2)(250) 50
Graphically the equilibrium level of taxation is at the point of intersection of the taxation
T tY 0.2Y , and the vertical line Ye = 250.
UNIT TWELVE
MATRICES
Introduction
What is a matrix?
A matrix is a two dimensional arrangement of numbers in rows and columns enclosed by a pair
of square brackets ([]), in the form shown below.
a11 a12 a1n
a a22 a2 n
21
am1 am 2 amn
The above figure shows an m n matrix of m rows and n columns.
Matrices can be added, multiplied, subtracted and decomposed in various ways. Matrices have
numerous applications in various disciplines such as Economics, Engineering, Statistics and
various other sciences.
Objectives
At the end of this unit, you should be able to do the following
Explain what is meant by a matrix
Demonstrate the ability to determine dimensions of matrices
Demonstrate the ability to find sums, differences, and scalar multiples of matrices and to
determine when matrices may be multiplied and to perform matrix multiplication
Demonstrate the ability to represent systems of linear equations with matrices and to use
matrices and technology to solve systems
Demonstrate the ability to solve applications using systems of equations
Demonstrate the ability to use technology to find inverses of matrices and to solve linear
systems with inverses
Demonstrate the ability to use technology to find determinants.
Basic Operations: Addition, Subtraction and Multiplication
Example
a b e f i
Let A and B and C
c d g h j
a b e f a e b f
Then A B
c d g h c d h
a b e f ae bg af bh a b i ai bj
And AB AC
c d g h ce dg cf dh
c d j ci dj
a b 3a 3b
A scalar times a matrix is 3
c d 3c 3d
The Determinant
The determinant of a matrix is a scalar value that is used in many matrix operations. The matrix
must be square (equal number of columns and rows) to have a determinant. The notation for
absolute value is used to indicate “the determinant of”, e.g. A means “the determinant of matrix
a b
A " and means to take the determinant of the enclosed matrix. Methods for finding the
c d
determinant vary depending on the size of the matrix.
The Determinant of a 2 2 Matrix
a b a b
Where A , det A A ad bc
c d c d
The Determinant of a 3 3 Matrix
The determinant of a 3 3 matrix can be calculated by repeating the first two columns as shown
in the figure at right. Then, add the products of each of three diagonal rows and subtract the
products of the three crossing diagonals as shown.
a11 a12 a13
a a22 a23 a11a22 a33 a12 a23a31 a13a21a32 a13a22 a31 a11a23a32 a12 a21a33
21
a31 a32 a33
This method used for 3 3 matrices does not work for larger matrices.
The Identity Matrix
The identity matrix, denoted by I n is characterized by the diagonal row of 1’s surrounded by
zeros in a square matrix. When a vector is multiplied by an identity matrix of the same dimension,
the product is the vector itself, I n v v .
1 0 0
rref A 0 1 0
0 0 1
Linear Transformation
This system of equations can be represented in the form Ax b . This is also known as a linear
transformation from x to b because the matrix A transforms the vector x into the vector b .
0 1 3 x 5
A 2 2 1
x y b 11
3 1 2 z 13
Adjoint
For 2 2 matrix, the adjoint is:
a b d b
Where A , adjA
c d c a
For a 3 3 and higher matrix, the adjoint is the transpose of the matrix after all elements have
been replaced by their cofactors (the determinants of the submatrices formed when the row and
column of a particular elements are excluded). Note the pattern of signs beginning with positive
in the upper – left corner of the matrix.
a b c
Where B d e f ,
g h i
e f d f d e e f b c b c
h i g i g h h i h i e f
b c a c a b d f a c a c
adjB
h i g i g h g i g i d f
b c
a c a b d e
a b a b
e f d f d e g h g h d e
Invertible Matrices
A matrix is invertible if it is a square matrix with a determinant not equal to 0 .The determinant
of an inverse matrix is equal to the inverse of the determinant of the original matrix:
det A1 1/ det A
The Inverse Transformation
If A is an invertible matrix, the inverse matrix could be used to transform b into x ,
Ax b, A1b x . An invertible linear transform such as this is called an isomorphism.
0 1 3 0.23 0.08 0.38
A 2 2 1 A 0.08 0.69 0.46
1
3 1 2 0.31 0.23 0.15
1
A matrix multiplied by its inverse yields the identity matrix. BB I n
1 1 1 10 6 1 1 0 0
2 3 2 2 1 0 0 1 0
3 8 2 7 5 1 0 0 1
Finding the Inverse Matrix
To calculate the inverse matrix, consider the invertible 3 3 matrix B .
1 1 1
B 2 3 2
3 8 2
1. First we must find the adjoint of matrix B . The adjoint of B is the transpose of matrix B
after all elements have been replaced by their cofactors. (The method of finding the adjoint
of a 2 2 matrix is different.) The notation means “the determinant of”.
3 2 2 2 2 3
8 2 3 2 3 8
1 1 1 1 1 1
adjB
8 2 3 2 3 8
1 1 1 1 1 1
3 2 2 2 2 3
2. Calculating the determinants we get
10 2 7
T
adjB 6 1 5
1 0 1
3. And then taking the transpose we get
10 6 1
B 2 1 0
7 5 1
4. Now we need the determinant of B
1 1 1
det 2 3 2 3 2 2 3 2 8 3 3 2 8 2 2 1
3 8 2
5. Filling in the values, we have the solution
adjB
The formula for the inverse matrix is B 1
det B
10 6 1
2 1 0
10 6 1
7 5 1
1
B 2 1 0 .
1
7 5 1
CRAMER’S RULE for Solving Simultaneous Equations
Given the equations:
2 x x2 x3 3
x1 3 x2 x3 7
x1 x2 x3 1
We express them in matrix form:
2 1 1 x1 3
1 3 1 x 7
2
1 1 1 x3 1
Where matrix A is
2 1 1
A 1 3 1
1 1 1
And vector y is
3
7
1
According to Cramer’s rule
3 1 1
7 3 1
1 1 1 8
x1 2
A 4
To find x1 we replace the first column of A with vector y and divide the determinant of this
new matrix by the determinant of A .
2 3 1
1 7 1
1 1 1 4
x2 1
A 4
To find x2 we replace the second column of A with vector y and divide the determinant of this
new matrix by the determinant of A .
2 1 3
1 3 7
1 1 1 8
x3 2
A 4
To find x3 we replace the third column of A with vector y and divide the determinant of this
new matrix by the determinant of A .
Application of Matrices
But first, let’s discuss how various situations in business and economics can be represented
using matrices. This can be done using the following examples.
(1) Annual productions of two branches selling three types of items may be represented as
follows:
Branch Item 1 Item 2 Item 3
2000 2876 2314
II 7542 3214 2969
(2) Number of staff in the office can be represented as follows:
2 peon
4 Clerk
3 Typist
1 Headclerk
1 Office sup er int endent
(3) The unit cost of transportation of an item from each of the three factories to each of the
four warehouses can be represented as follows:
Factory Warehouse
W1 W2 W3 W4
13 12 17 14
22 26 11 19
16 15 18 11
Applications of Matrix Addition and Subtraction of matrices can be illustrated through the
following examples:
Example 1
The quarterly sales of Jute, Cotton and Yarn for the year 2002 and 2003 are given below.
Year 2002
Q1 Q2 Q3 Q4
Jute 20 25 22 20
Cotton 10 20 18 10
A
Yarn 15 30 15 10
Year 2003
Q1 Q2 Q3 Q4
Jute 10 15 20 20
Cotton 5 20 18 10
B
Yarn 8 30 15 10
Find the total quarterly sales of Jute, Cotton and Yarn for the two years.
Solution
The total sales of Jute, cotton and yarn will be obtained as under
20 25 22 20 10 15 20 20 30 40 42 40
10 20 18 10 5 10 18 10 15 40 33 40
A B
15 20 15 15 8 30 15 10 23 50 30 25
Example 2
X ltd has the following sales position of its products A and B at its two centres P and Q at the
end of the year.
P Q
A 50 45
Y
B 60 70
If the sales for the first three months is given
P Q
A 30 15
Q
B 20 20
Find the sales position for the last nine months
Solutions
Given are the sales positions for the year (Y) and for the first three months (Q). hence sales
position for the remaining nine months
50 45 30 15 A 20 30
Y Q
60 70 20 20 B 40 50
Applications of Matrix Multiplication
It is important to note that two matrices can be multiplied if and only if the number of columns
of the first matrix equals the number of rows of the second. The resultant matrix will have the
number of rows equal to the first matrix and the number of columns equal to that of the second
matrix.
In other words,
A matrix of the order axb can only be multiplied with a matrix of order bxc .
The resultant matrix will be of the order axc .
The application of multiplication of matrices can be illustrated through the following examples.
Example 3
Ram, Shyam and Mohan purchased biscuits of different brands P,Q and R. Ram purchased 10
packets of P, 7 packets of Q and 3 packets of R. Shyam purchased 4 packets of P, 8 packets of Q
and 10 packets of R. Mohan purchased 4 packets of P, 7 packets of Q and 8 packets of R. If brand
P costs K4, Q costs K5 and R costs K6 each, then using matrix operation, find the amount of money
spent by these persons individually.
Solution
Let Q be the matrix denoting the quantity of each brand of biscuit bought by P, Q and R and let
C be the matrix showing the cost of each brand of biscuit.
P Q R
Ram 10 7 3
Q Shyam 4 8 10
Mohan 4 7 8
P 4
C Q 5
R 6
Since the number of columns of the first matrix should be equal to the number of rows of the
second matrix for multiplication to be possible, the above matrices shall be multiplied in the
following order.
10 7 3 4 10 4 7 5 3 6 10 35 18 93
Q C 4 8 10 5 4 4 8 5 10 6 16 40 16 116
4 7 8 6 4 4 7 5 8 6 16 35 48 99
Amount spent by Ram, Shyam and Mohan is K93, K116 and K99.
Example 4
A firm produces three products A, B and C requiring the mix of three materials P, Q and R. The
requirement (per unit) of each product for each material is as follows:
P Q R
A 2 3 1
M B 4 2 5
C 2 4 2
Using matrix notations, find
(i) The total requirement of each material if the firm produces 100 units of each
product.
(ii) The per unit cost of production of each product if the per unit cost of materials P, Q
and R is K5, K10 and K5 respectively.
(iii) The total cost of production if the firm produces 200 units of each product.
Solution
(i) The total requirement of each material if the firm produces 100 units of each
product can be calculated using the matrix multiplication given below.
A B C P Q R
2 3 1 A
100 100 100 4 2 5 B 800 900 800
2 4 2 C
(ii) Let the per unit cost of materials P, Q and R be represented by the 3X1 matrix as
under
P 5
C Q 10
R 5
With the help of matrix multiplication, the per unit cost production of each product
would be calculated as under
2 3 1 5 A 45
AC 4 2 5 10 B 65
2 4 2 5 C 60
(iii) The total cost of production if the firm produces 200 units of each product would be
given as
45
200 200 200 65 34, 000
60
Hence the total cost of production will be K34, 000.
Example 5
Mr. X went to a market to purchase 3 kg of sugar, 10kg of wheat and 1kg of salt. In a shop near
to Mr. X’s residence, these commodities are priced at K20, K10 and K8 per kg whereas in the local
market these commodities are priced at K15, K8 and K6 per kg respectively. If the cost of
travelling to local market is K25, find the net savings of Mr. X, using matrix method.
Solution
Let matrices Q and P represent quantity and price. Then,
Sugar Wheat Salt
Quantity Matrix Q 3 10 1
Shop local market
Sugar 20 15
Price Matrix P Wheat 10 8
Salt 8 6
20 15
Therefore, Total Price Q P 3 10 1 10 8
8 6
Now, 168 131
Cost of purchasing from shop = K168 and
Cost of purchasing from local market =K131 + K25 (cost of travel) = K156
Hence, net savings to Mr. X from purchasing through local market = 168 – 156 = K12.
Applications to Systems of Linear Equations
The following examples can be used to illustrate the common methods of solving systems of
linear equations that result from applied business and economic problems.
Example 6
Mr. X invested a part of his investment in 10% bond A and a part in 15% bond B. His interest
income during the first year is K4000. If he invests 20% more in 10% bond A and 10% more in
15% bond B, his income during second year increases by K500. Find his initial investment and
the new investment in bonds A and B using matrix method.
Solution
Let initial investment be x in 10% bond A and y in 15% bond B. Then, according to given
information, we have
0.10 x 0.15 y 4, 000 or 2 x 3 y 80, 000
0.12 x 0.165 y 4,500 or 8 x 11y 300, 000
Expressing the above equations in matrix form, we obtain
2 3 x 80, 000
8 11 y 300, 000
A X B
This can be written in the form AX B or X A1B
1
Since, A 2 0, A exists and the solution can be given by:
X A1B
1 11 3 80, 000
2 8 2 300, 000
1 20, 000
2 40, 000
10, 000
20, 000
Hence x= K10, 000, y= K20, 000 and new investments would be K12, 000 and K22, 000
respectively.
Example 7
A company produces three products every day. Their total production on a certain day is 45 tons.
It is found that the production of the third product exceeds the production of the first product
by 8 tons while the total combined production of the first and third product is twice that of the
second product. Determine the production level of each product using Cramer’ rule.
Solution
Let the production level of the three products be x, y and z respectively. Therefore, we will have
the following equations
x y z 45 - ------(1)
z x 8
i.e. x 0 y z 8 ---------(2)
x z 2y
i.e. x 2 y z 0 -------------(3)
Therefore , we have, using (1), (2) and (3)
1 1 1 x 45
1 0 1 y 8
1 2 1 z 0
which gives us
1 1 1
1 0 1 6
1 2 1
Since 0 , there is a unique solution
45 1 1
1 8 0 1 66
0 2 1
1 45 1
2 1 8 1 90
1 0 1
1 1 45
3 1 0 8 114
1 2 0
Therefore,
66
x 11
6
90
y 15
6
114
z 19
6
Hence, the production levels of the products are as follows:
First product – 11 tons
Second product – 15 tons
Third product – 19 tons
Example 8
An automobile company uses three types of steel S1, S 2 and S 3 for producing three types of cars
C1,C2 and C3 . The steel requirement (in tons) for each type of car is given below:
Cars C1 C2 C3
S1, 2 3 4
Steel S2 1 1 2
S3 3 2 1
Determine the number of cars of each type which can be produced using 29, 13 and 16 tons of
steel of the three types respectively.
Solution
Let x, y and z denote the number of cars that can be produced of each type. Then we have
2 x 3 y 4 z 29
x y 2 z 13
3x 2 y z 16
The above information can be represented using the matrix method, as under
2 3 4 x 29
1 1 2 y 13
3 2 1 z 16
The above equation can be solved using Gauss Jordan elimination method. By applying the
operation R1 R2 the given system is equivalent to
1 1 2 x 13
2 3 4 y 29
3 2 1 z 16
Now applying R2 R2 2 R1 and R3 R3 3R1 , the above system is equivalent to
1 1 2 x 13
0 1 0 y 3
0 1 5 z 23
Applying R3 R3 R2 the above system is equivalent to
1 1 2 x 13
0 1 0 y 3
0 0 5 z 20
X Y 2Z 13 (1)
Y 3 (2)
5Z 20 (3)
Therefore, z 4 . Substituting y 3 and z 4 in (1) we get x 2 . Hence the solution is x 2 ,
y 3 and z 4
The Leontief Input – Output Model
The Leontief Input – Output Model discusses the interdependence of industries on each other.
Based on the assumption that each industry in the economy has two types of demands:
external demand (from outside the system) and internal demand (demand placed on one
industry another in the system), the Leontief model represents the economy as the system of
linear equations. The Leontief model was invented in the 30’s by Professor Wassily Leontief
who was awarded the Nobel Prize in Economics in 1973 for his effort.
There are two types of Leontief models, i.e. Closed and Open.
Closed Input – Output Model
Consider an economy consisting of n interdependent industries (or sectors) S1 , S2, ..., Sn . That
means that each industry consumes some of the goods produced by the other industries,
including itself (for example, a power generating plant uses some of its own power for
production). We say that such an economy is closed if it satisfies its own needs; that is, no goods
leave or enter the system. Let mij be the number of units produced by industry S i and necessary
to produce one unit of industry S j . If Pk is the production level of industry S k , then mijPj
represents the number of units produced by industry S i and consumed by industry S j . Then the
total number of units produced by industry S i is given by:
1 1 j P2 mi 2 ... Pn min
Pm
In order to have a balanced economy, the total production of each industry must be equal to its
total consumption. This gives the linear system:
m11 P1 m12 P2 ... m1n Pn P1
m21 P1 m22 P2 ... m2 n Pn P2
: : : : :
. . . . .
mni P1 mn 2 P2 ... mnn Pn Pn
m11 m1n
If A
mn1 mmn
Then the above system can be written as AP P ,
P1
P
P 2
Pn
A is called the input – output matrix.
We are then looking for a vector P satisfying AP P and with non – negative components, at
least one of which is positive.
Example 9
Suppose that the economy of a certain region depends on three industries: service, electricity
and oil production. Monitoring the operations of these three industries over a period of one
year, we were able to come up with the following observations.
(1) To produce 1 unit worth of service, the service industry must consume 0.3 units of its
own production, 0.3 units of electricity and 0.3 units of oil to run its operations.
(2) To produce 1 unit of electricity, the power – generating plant must by 0.4 units of
service, 0.1 units of its own production, and 0.5 units of oil.
(3) Finally, the oil production company requires 0.3 units of services, 0.6 units of electricity
and 0.2 units of its own production to produce 1 unit of oil.
Find the production level of each of these industries in order to satisfy the external and the
internal demands assuming that the above model is closed, that is, no goods leave or enter the
system.
Solution
Consider the following variables:
(1) P1 = production level for the service industry
(2) P2 = production level for the power generating plant (electricity)
(3) P3 = production level for the oil production company
Since the model is closed, the total consumption of each industry must equal its total
production. This gives the following linear system:
0.3 p1 0.3 p2 0.3 p3 P1
0.4 p1 0.1 p2 0.5 p3 P2
0.3 p1 0.6 p2 0.2 p3 P3
The input – output matrix is
0.3 0.3 0.3
A 0.4 0.1 0.5
0.3 0.6 0.2
And the system above can be written as A I P 0 . Note that this homogeneous system has
infinitely many solutions (and consequently a nontrivial solution) since each column in the
coefficient matrix sums to 1. The augmented matrix of this homogeneous system is
0.7 0.3 0.3 0
0.4 0.9 0.5 0
0.3 0.6 0.8 0
This can be reduced to
1 0 0.82 0
0 1 0.92 0
0 0 0 0
To solve the system, we let P3 t (parameter), and then the general solution is
P1 0.82t
P2 0.92t
P3 t
And as we mentioned above, the values of the variables in this system must be nonnegative in
order for the model to make sense. In other words, t 0 . Taking t 100 for example would
give the solution
P1 82 units
P2 92 units
P3 100 units
Open Input – Output Model
The first Leontief model treats the case where goods leave or enter the economy, but in reality
this does not happen very often. Usually, a certain economy has to satisfy an outside demand,
for example, from bodies like the government agencies. In this case, let d i be the demand from
the di th outside industry, Pi and mij be as in the closed model above, then
Pi mi1P1 mi 2 P2 ...min Pn di
for each i . This gives the following linear system (written in a matrix form):
P AP d
where P and A are as above and
d1
d
d 2
d3
is the demand vector.
One way to solve this linear system is
P AP d
I A P d
P I A d
1
Of course, we require here that the matrix I A be invertible, which might not be always the
case. If , in addition, I A
1
has non – negative entries, then the components of the vector P
are non- negative and therefore they are acceptable as solutions for this model. We say in this
case that the matrix A is productive.
Example 10
Consider an open economy with three industries: coal – mining operation, electricity –
generating plant and an auto – manufacturing plant. To produce Re 1 of coal, the mining
operation must purchase Re 0.1 of its own production, Rs 0.30 of electricity and Re 0.1
worth of automobile for its transportation. To produce Re 1 of electricity, it takes Rs 0.25 of
coal, Rs 0.4 of electricity and Rs 0.15 of automobile. Finally, to produce Re 1 worth of
automobile, the auto – manufacturing plant must purchase Rs 0.2 of coal, Rs 0.5 of electricity
and consume Rs 0.1 of automobile. Assume also that during a period of one week, the
economy has an exterior demand of Rs 50,000 worth of coal, Rs 75, 000 worth of electricity,
and Rs 125, 000 worth of autos. Find the production level of each of the three industries in
that period of one week in order to exactly satisfy both the internal and the external demands.
Solution
The input – output matrix of this economy is
0.1 0.25 0.2
A 0.3 0.4 0.5
0.1 0.15 0.1
and the demand vector is
50, 000
d 75, 000
125, 000
Now, using the equation
P I A d
1
Where
0.9 0.25 0.2
I A 0.3 0.6 0.5
0.1 0.15 0.9
Using the Gauss Jordan elimination techniques we find that
1.464 0.803 0.771
I A1 1.007 2.488 1.601
0.330 0.503 1.464
which gives
1.464 0.803 0.771 50, 000 229921.59
P 1.007 2.488 1.601 75, 000 437795.27
0.330 0.503 1.464 125, 000 237401.57
So, the total output of the coal – mining operation must be Rs 229921.59, the total output for
the electricity – generating plant is Rs 437795.27 and the total output for the auto –
manufacturing plant is Rs 237401.57.
Activity
1 2 3 4
1. Given that A and B
2 1 1 2
Find
(i) A B
(ii) B A
1 3 1 2 1
2. Given that C and D
2 1 2 3 5
(a) CD
(b) DC
2 1
1 2 3 5 5
3. If A and B 0 1 , show that AB
3 2 5 1 2 11 11
4. Use the method of elementary row operations to solve the following system of equations
3 x1 3 x2 5 x3 6 x1
x1 7 x2 5 x3 4
5 x1 10 x2 15 x3 9
5. A company manufactures three goods, X , Y and Z , each of which is made from three
types of input, A, B and C . Each unit of X requires 1 unit of A , 7 units of B and 3
units of C . Each unit of Y requires 4 units of A , 3 units of B and 1 unit of C .
Furthermore, one unit of Z requires 2 units of A , 4 units of B and 2 units of C . In a
particular days production the company uses up 105 units of A , 135 units of B and 55
units of C .
(a) Create a matrix equation to represent the usage of A, B and C in the day’s production
of x, y and z units of X , Y and Z respectively
(b) Using matrix algebra, determine the values of x, y and z
6. The supply function for a commodity takes the form
q s p ap 2 bp c
For some constants a, b, c . When p 1 , the quantity supplied is 5 ; when p 2 , the
quantity supplied is 12 ; when p 3 , the quantity supplied is 23 . Find the constants a, b, c .
7. Express the following set of equations in matrix form and hence solve them using a
matrix method:
x y z 1
2x y z
x 3y z 7
8. A high class dressmaker makes three types of dresses. She makes cheap ‘everyday’ dresses,
medium – priced ‘cocktail’ dresses and expensive ‘ballroom’ dresses. The making of the
dresses involves the ‘inputs’ of fabric, labour, fastenings and machine time. The following
table shows the units of input required per dress for each dress type.
‘Everyday’ ‘Cocktail’ ‘Ballroom’
Fabric 5 6 8
Labour 20 25 30
15 22
Fastenings 20
7 12
Machine 9
time
The dressmaker makes a combination of the three dress types which uses exactly 270
units of fabric, 1050 units of labour and 790 units of fastenings.
(a) How many of each type of dress does she make?
(b) What is the corresponding machine time used?
9. The function f x is given by
a
f x bx c
1 x2
8
For some constants a, b, c . Given that f 0 8, f 1 3 and f 2 ,
5
(a) Find, a system of linear equations for a, b, c .
(b) Solve this system using a matrix method.
UNIT THIRTEEN
LINEAR PROGRAMMING
Introduction
Linear programming deals with the optimization (maximization or Minimization) of a function of
variables known as Objective Function, subject to a set of linear equations and/or inequalities
known as Constraints. The objective function may be profit, cost, production capacity or any
other measure of effectiveness, which is to be obtained in the best possible or optimal manners.
The constraints may be imposed by different resources such as market demand, production
process and equipment, storage capacity, raw material availability, e.t.c. The word Linear
indicates that the relationships arising from the constraints (condition) are represented by
straight lines. The relationships are of the form y a bx .
Programming, in this context, indicates that decisions are made systematically.
Objectives
At the end of this unit, you should be able to do the following:
Identify or define, objective function, constraints, feasible region, Iso – profit or Iso –
cost methods, corner point solution
Describe or explain how to formulate linear models
Describe or explain graphical method of linear programming
Describe or explain simplex method of linear programming.
Areas of Application of Linear Programming
A few areas of application are given below.
Example 1 (Diet Problem)
A person wants to decide the constituents of a diet which will fulfill his daily requirements of
proteins, fats and carbohydrates at the minimum cost. The choice is to be made from four
different types of foods. The yields per unit of these foods are given in the table below.
Food Type Yield per Unit Cost per Unit
(kwacha)
Proteins Fats Carbohydrates
1 3 2 6 45
2 4 2 4 40
3 8 7 7 85
4 6 5 4 65
Minimum
Requirement 800 200 700
Formulate linear programming model for the problem.
Solution
Formulation of L.P Model
Let x1 , x2 , x3 and x4 denote the number of units of food of type 1, 2,3 and 4 respectively.
Objective is to minimize the cost i.e.,
Minimize z 45x1 40 x2 85x3 65x4 kwacha
Constraints are on the fulfillment of the daily requirements of the various constraints.
i.e., for proteins, 3x1 4 x2 8 x3 6 x4 800
for fats, 2 x1 2 x2 7 x3 5 x4 200
and for carbohydrates , 6 x1 4 x2 7 x3 4 x4 700
where x1 , x2 , x3 , x4 , each 0 .
Example 2 (Blending Problem)
A firm produces an alloy having the following specification:
(1) Specific gravity 0.98
(2) Chromium 8%
(3) Melting point 450 C .
Raw materials A, B and C having the properties shown in the table can be used to make the
alloy.
Properties of raw material
Property A B C
Specifi gravity 0.92 0.97 1.04
Chromium 7% 13% 16%
Melting point 440 C 490 C 480 C
Costs of the various raw materials per ton are: K 90 for A , K 280 for B and K 40 for C .
Formulate the L.P. model to find the proportions in which A , B and C be used to obtain an
alloy of desired properties while the cost of raw materials is minimum.
Solution
Formulation of linear programming model.
Let the percentage contents of raw materials A, B and C to be used for making the alloy be x1 , x2
and x3 respectively.
Objective is to minimize the cost
i.e., minimize Z 90x1 280 x2 40 x3
Constraints are imposed by the specifications required for the alloy.They are
0.92 x1 0.97 x2 1.04 x3 0.98,
7 x1 13x2 16 x3 8,
440 x1 490 x2 480 x3 450,
and x1 x2 x3 100 ,
as x1 , x2 and x3 are the percentage contents of materials A , B and C in making the alloy.
Also x1 x2 x3 0.
Example 3 (Investment Problem)
Mr. Zulu, a retired Government Officer, has recently received his retirement benefits namely,
provident fund, gratuity, e.t.c. He is contemplating as to much funds he should invest in various
alternative open to him so as to maximize return on investment. The investment alternatives are:
government securities, fixed deposits of a public limited company, equity shares, time deposits
in banks, national saving certificates and real estate. He has made a subjective estimate of the
risk involved. The data on the return on investment, the number of years for which the funds will
be blocked to earn this return on investment and the subjective risk involved are as follows:
Mr. Zulu, a retired Government Officer, has recently received his retirement benefits namely,
provident fund, gratuity, e.t.c. he is contemplating as to much funds he should invest in various
alternatives open to him so as to maximize return on investment. The investment alternatives
are: government securities, fixed deposits of a public limited company, equity shares, time
deposits in banks, national saving certificates and real estate. He has made a subjective estimate
of the risk involved. The data on the return on investment, the number of years for which the
funds will be blocked to earn this return on investment and the subjective risk involved are as
follows:
Investment alternatives Return No. of years Risk
Government Securities 6% 15 1
Company deposits 15% 3 3
Equity shares 20% 6 7
Time deposits 10% 3 1
N.S.C 12% 6 1
Real estate 25% 10 2
He has wondering what percentage of funds he should invest in each alternative so as to
maximize the return on investment. He decided that average risk should not be more than 4 , and
funds should not be locked up for more than 15 years. Formulate an L. P model for the problem
if he does not want more than 30% of the investment to be put in the real estate.
Solution
Formulation of L.P models.
Let x1 , x2 , x3 , x4 , x5 , x6 be the percentage of funds to be invested in alternative 1, 2,3, 4,5 and 6
respectively.
Objective is to maximize the return on investment.
i.e maximize Z Z 0.06 x1 0.15 x2 0.20 x3 0.10 x4 0.12 x5 0.25x6
Constraints are
on the average risk x1 3x2 7 x3 x4 x5 2 x6 4 ,
on the lock –up period 15 x1 3x2 6 x3 3x4 6 x5 10 x6 15,
on the investment in real estate x6 0.3,
on the total amount invested x1 x2 x3 x4 x5 x6 1,
where x1 , x2 ,..., x6 0
Linear Inequations in Two Variables
Linear inequations are represented by half planes on the co – ordinate plane. In order to plot the
graph we must first transform the inequality into the equation. This is done so that we form a
straight line from which the boundary between two half planes can be determined.
Secondly we make a table of values for the equation.
To determine the half plane to be unshaded to represent the inequation, we take a test point
and substitute its values into the original inequation. If the inequation is true for this point, the
half – plane from where this point is taken, must be unshaded.
If an untrue inequation is obtained, then the half-plane from which the point was taken is shaded
and the other half-plane is unshaded.
If the line does not pass through the origin, it is convenient to use the origin 0, 0 as the test
point.
Example 4 (Production Planning Problem)
A company makes desks and chairs using two work-shops, workshops I and II. To make a single
desk one hour is required in workshop I and two hours in workshop II. For a chair, one hour is
required in each workshop. Workshop I is available for four hours and workshop II for six hours.
The profit from each desk sold is K 550 and from each chair sold is K 475 . The company wishes
to maximize the total profit from the furniture.
(a) Formulate a mathematical model for the given information
(b) Show on a graph the solution set of the system of inequations.
(c) Find the number of desks and chairs which should be made to maximize the total profit
from the furniture.
(d) State this profit.
Solution
(a) Formulation of L.P Model
Hours required per desk and chair
Number per Profit per desk Workshop I Workshop II
and chair
Item Desk and chair ( 4 hours ( 6 hours
made available) available)
Desk x1 550 1 2
Chair x2 457 1 1
To make x1 desks and x2 chairs will require x1 x2 hours in workshop I and 2x1 x2 hours
in workshop II.
Considering the time each workshop has available determine the maximum profit that
can be realized by selling the desks and chairs.
The objective is
Maximize Z 550 x1 475 x2 (1)
The constraints are:
x1 x2 4 (2)
2 x1 x2 6 (3)
x1 0 (4)
x2 0 (5)
X2
0 1 2 3 4 x1
x1 x2 4
2 x1 x2 6
There are several integer points in the region. The values of 550 x1 475 x2 for the solutions are:
A 0, 4 550 0 475 4 1900
B 2, 2 550 2 475 2 2050
C 3,0 550 3 475 0 1650
D 0, 0 550 0 475 0 0
E 0,3 550 0 475 3 1425
F 0, 2 550 0 475 2 950
G 0,1 550 0 475 1 475
H 1,3 550 1 475 3 1975
I 1, 2 550 1 475 2 1500
J 1,1 550 1 475 1 1025
K 1,0 550 1 475 0 550
L 2,1 550 2 475 1 1575
M 2,0 550 2 475 0 1100
(b) The point B 2, 2 i.e. two chairs and two desks gives the maximum profit.
(c ) The maximum profit is K 2050
SIMPLEX METHOD (Technique or Algorithm)
The graphical method cannot be applied when the number of variables involved in the L.P.
problem is more than three or rather two. The simplex method is used to solve any L.P. problem
(for which the solution exists) involving any number of variables and constraints (hundreds or
even thousands).
The computational procedure in the simplex method is based on the fundamental property that
the optimal solution to an L.P. problem, if it exists, occurs only at one of the corner points of the
feasible region.
The simplex method always starts with initial basic feasible solution i.e., origin, which is one of
the corner points of the feasible region. This solution is then tested i.e. it is ascertained whether
improvement in the value of the objective function is possible by moving to the next corner point
of the feasible region.
Example:
A firm manufactures two products A and B on which the profits earned per unit are K 3 and
K 4 respectively. Each product is processed on two machines M 1 and M 2 . Product A requires
one minute of processing time on M 1 and two minutes on M 2 , while B requires one minute on
M 1 and one minute on M 2 . Machine M 1 is available for not more than 7 hours, 30 minutes
while machine M 2 is available for 10 hours during any working day. Find the number of units of
products A and B to be manufactured to get maximum profit.
Formulation of linear programming model
Let x1 and x2 denote the number of units of products A and B to be produced per day.
Objective is to maximize the profit.
i.e. maximize Z 3x1 4 x2 (i)
Constraints are on the time available for machines M 1 and M 2
i.e., for machine M1 ,1.x1 1x2 450 , and (ii)
for machine M 2 , 2 x1 1.x2 600 (iii)
where x1 , x2 0 .
Thus the problem is to maximize equation (i) subject to relations (ii) and (iii).
Step 1. Express the problem in standard form.
The given problem is said to be expressed in standard form if the given (decision) variables are
non- negative and the right – hand side of the constraints are non-negative.
Since the first two conditions are met with in the problem, non- negative slack variables S1 and
S 2 are added to the left – hand side of the first and second constraints respectively to convert
them into equations.
Maximize Z 3x1 4 x2 0S1 0S2 , (1)
Subject to x1 x2 S1 450 ,
2 x1 x2 S2 600, (2)
Where x1 , x2 , S1 , S2 0 .
Step 2. Find initial basic feasible solution
In the simplex method a start is made with a feasible solution, which we shall get by assuming
that the profit earned is zero. This will be so when decision variables x1 and x2 are each equal to
zero. These variables are called non-basic variables. Substituting x1 x2 0 in equations (2)
yields S1 450, S2 600 , which is called the initial basic feasible solution. Note that Z 0 for
this solution. Variables S1 and S 2 are called basic variables and they form the basis.
The problem in standard form and the solution obtained above are now expressed in the form of
a table, called the simplex table or (tableau).
Table 1
Contribution / unit C j 3 4 0 0
Basis Body matrix Identity matrix
CB (Basic variables) x1 x2 S1 S2 b
0 S1 1 1 1 0 450
0 S2 2 1 0 1 600
Initial basic feasible solution
Interpretation of the data in the above table is given below.
(i) The first row C j indicates the coefficients of the variables in the objective
function equation (1). The second row indicates the variables in the problem for
which C j coefficients have already been written.
(ii) The first column ( CB - Column) represents the coefficients of the current basic
variables S1 and S 2 in the objective function. The second column is the basis
column (or product mix column). It represents the basic variables of the current
solution. The basic variables are the slack variables S1 and S 2
(iii) The body matrix (also called coefficient matrix) under non- basic variables x1 and
x2 represents their coefficients in the constraints (2).
* These coefficients may be positive, zero or negative in a problem.
(iv) The identity matrix represents the coefficients of slack variables in the constraints
(2)
Note that every simplex table will have identity matrix under the basic variables.
(v) The b -column is the last column of table 1. This is also called quantity column.
This column indicates the values of the basic variables S1 and S 2 in the initial
basic feasible solution found earlier.
Variables not entered under the basis column are non-basic variables and their
values are zero. E.g. x1 and x2 are not listed under basis column of table 1 as they
are currently non- basic variables and their values are zero.
STEP 3. Perform optimality test
The next step is to ascertain whether the initial basic feasible solution found in step 2 can be
improved or not.
This solution involves zero profit, an improved solution should result in profit higher than zero.
Two more rows are now added to the tables 1 – as shown in table 2.
Table 2
Cj 3 4 0 0
CB Basis x1 x2 S1 S2 b
0 S1 1 (1 ) 1 0 450 450
0 S2 2 1 0 1 600 600
Zj 0 0 0 0 0
Cj – Zj 3 4 0 0
K Second feasible solution
Z j – row coefficients under any column are obtained by adding the products of elements under
that column with the corresponding CB values.
i.e Z j CB aij , where aij are the matrix element in the ith row and jth column
e.g. Z1 0 1 0 2 0
NOTE: The elements in the C j – Z j row are, therefore, examined; in case they are negative or
zero, the current solution is optimal and in case any element is positive, it is not optimal and
there is scope for improvement since two elements 3 and 4 inches x1 and x2 variables columns
are positive, the solution is not optimal.
Step 4. Iterate towards an optimal solution.
At each iteration, the simplex method moves the current basic feasible solution to an improved
basic feasible solution. This is done by replacing one current basic variable by a new non- basic
variable as explained below.
(i) Selection of the entering variable
For this we observe C j – Z j for different columns and mark the column for
maximum positive value. The variable heading that column is the one which
should enter the solution i.e., the corresponding product should be produced. This
variable is called entering variable and the column in which it occurs is called the
Key Column K . If more than one variable appears with the same maximum
value, any of these variables may be selected arbitrarily as the incoming variable.
When no more positive values remain in the C j – Z j row (in some succeeding
simplex table) the profit attained is maximum and optimal solution is achieved.
In Table 2 , highest positive value is 4 , accordingly x2 is the entering variable and
this column is marked as key column.
(ii) Selection of the leaving variable.
Variable x2 is now going to enter the basis column in the next table. It will either
replace the current basic variable S1 or S 2 . To determine which of the slack
variables to be replaced (removed or made zero or made non- basic) elements
under b – column (quality column) are divided by the corresponding elements of
the key column and the row containing the minimum non- negative ratio is
marked. The column containing these ratios, marked as - column in table 2 is
also called minimum ratio or replacement ratio column. The current basic
variable is, then, to be replaced and is called leaving variable and is to be made
zero. The row so marked is called the key ( or pivot) row. Zero is considered as
non- negative and negative ratios are discarded. In case all ratios are negative of
infinity, the solution is unbounded. The element lying at the intersection of key
column and key row is called Key Element and is enclosed in .
450 600
In Table 2 , replacement ratios are 450 and 600 ; S1 is the outgoing
1 1
variable and 1 is the key element. The other elements in the key column are
called intersectional elements.
(iii) Evaluating (updating) the new solution or preparing the new simplex table.
Table 3 is now derived from table 2 by performing some row operations. First
basis column now contains variable x2 in place of S1 . Corresponding CB coefficient
is changed from 0 to 4 .
Since in Table 3 x2 is the basic variable, x2 – column must be made an identity column,
key element if not unit is made unit and other intersectional elements are made zeros by
suitable row operations.
In Table 2 , key element is already 1 , accordingly elements 1, 1 ,1, 0, 450 of S1 – row are
retained as such as the elements 1,1,1, 0, 450 of x2 – row of Table 3 . The intersectional element
1 in x2 – column is now made zero by subtracting the key element 1 from it. However this
subtraction is to be done for all the elements of S 2 – row of table 2 to get elements of S 2 – row
of table 3 will be
2 1 1,1 1 0, 0 1 1,1 0 1 and 600 450 150 . Table 3 can now be completed and is
shown below.
Table 3 .
Cj 3 4 0 0
CB Basis x1 x2 S1 S2 b
4 x2 1 1 1 0 450
0 S2 1 0 1 1 150
Zj 4 4 4 0 1800
Cj – Zj 1 0 4 0 2nd feasible solution
Z j 1 4 0 1 Z j CBb
1 4 0 0 4 450 0 150 1800
1 4
Step 5: perform optimality test for second feasible solution.
Compute Z j CB aij elements for variable columns. They are 4, 4, 4, 0 . Value of Z j under b -
column represents the value of objective function. Note that the profit has increased from 0 to
K 1800 after the iteration.
Next compute C j – Z j row. Since all elements are either zero or negative, the second feasible
solution is optimal and the computational procedure comes to an end.
Here the optimal solution is
x1 0
x2 450
Z max K1800
The company should, therefore, not produce product A at all, it should produce 450 units of
product B to get maximum daily profit of K1800 .
Example 2
Use simplex method to solve the following problem:
Maximize Z 2 x1 5 x2
Subject to x1 4 x2 24
3x1 x2 21
x1 x2 9
x1 , x2 0
Solution
Step 1. Express the problem in standard form
Introducing slack variables S1, S2 and S3 the problem can be expressed in the following standard
form.
Maximize Z 2 x1 5 x2 0S1 0S2 0S3
Subject to x1 4 x2 S1 24
3x1 x2 S2 21
x1 x2 S3 9
x1 , x2 , S1 , S2 , S3 0
The slack variables can be treated as imaginary products, contributing zero profits. Accordingly,
they are assigned zero coefficients in the objective function.
Step 2. Find initial basic feasible solution.
Setting non-basic variables x1 0, x2 0 , the constraints yield the following initial basic feasible
solution (i.b.f.s.):
S1 24, S2 21, S3 9 and Z 0
We express the above information in the simplex tableau. The non – basic variables x1 and x2
are each zero. If any of them is made positive, Z will increase. This can be achieved by changing
the basis of table 1 , by including x1 , x2 in place of some basic variables ( S1 , S2 or S 3 ) which form
the present basis.
Table 1
Cj 2 5 0 0 0
F.R. CB Basis x1 x2 S1 S2 S3 b
0 S1 1 4 1 0 0 24 6
¼ 0 S2 3 1 0 1 0 21 21
¼ 0 S3 1 1 0 0 1 9 9
Zj 0 0 0 0 0 0
Cj Z j 2 5 0 0 0
K Initial basic feasible solution
STEP 3. Perform optimality test
By performing the optimality test we can find whether the current feasible solution can be
improved or not compute C j Z j , where Z j CB aij .
Since C j Z j is positive under x1 and x2 –columns, i.b.f.s. is not optimal and can be improved.
STEP 4 . Iterate towards an optimal solution
Mark the Key Column, Key row and Key element as shown in Table1 . x2 is the incoming variable
which replaces the outgoing variable S1 in the next table ( Table 2 ). Key element ( 4 ) is made 1
in that table. For this, elements of S1 – row in Table 1 are divided by 4 and written as elements
of x2 – row in Table 2 . The intersectional element 1 and 1 of key column x2 are now made zero
each in Table 2 . For this, first the elements of key row in Table 1 are multiplied by a proper
multiple (also called fixed ratio) and then are subtracted from elements of S 2 – row. Proper
multiple or fixed ratio (F.R) is always equal to intersectional element divided by key element.
This is repeated for S 3 – row as well. The fixed ratios ¼ , ¼ are entered in the first column of table
1 against S 2 – row and S 3 – row.
These row operations lead to the following elements of S 2 – row and S 3 – row of Table 2.
1 11 4 1 1 0 0 24
S 2 – Row: 3 ,1 0, 0 ,1 1, 0 0, 21 15;
4 4 4 4 4 4 4 4
1 3 4 1 1 0 0 24
S 3 – Row: 1 ,1 0, 0 , 0 0,1 1,9 3.
4 4 4 4 4 4 4 4
Table 2
Cj 2 5 0 0 0
F.R. CB Basis x1 x2 S1 S2 S3 b
1 1 1
3 5 x2 1 0 0 6 24
4 4
11 0 S2 11 0 1 1 0 15 60
3 4 4 11
0 S3 34 0 1
4
0 1 3 4
Zj 5 5 5 0 0 30
4 4
Cj Z j 3 0 5 0 0
4 4
K Second feasible solution
Fixed ratio ( F.R. ) = Intersection element
Key element
Step 5. Check second feasible solution for optimality
Z j values and C j Z j values for various variable – columns are calculated in table 2 . Since the
value under x1 – column is positive; the second feasible solution is not optimal.
Step 6. Iterate towards an optimal solution
x1 – column is marked as the key column. x1 is the incoming variable. Replacement ratios are
6 15 60 3
24, , 4 . Since 4 is the minimum non-negative ratio, S 3 – row is marked as
1 11 11 3
4 4 4
the key row. S 3 is the outgoing variable. It is replaced by x1 in Table 3 . Elements of S 3 – row in
table 2 are multiplied by 4 3 to make the key element 1 in table 3 and the values are entered
as the element of x1 –row in this table. Next, the intersectional elements 1 4 ,11 4 of x1 – column
1
in table 2 are to be made zeros in table 3 . To make as 0 , elements of S 3 – row table 2 are
4
1
1
multiplied by the fixed ratio 4 and the values are then subtracted from the elements of x2
3 3
4
– row to get the new elements of x2 – row in table 3 . These elements are
1 1 3 1 1 1 1 1 1 1 1 1 1 1
0,1 0 1, , 0 0 0, 0 1 , 6 3 5
4 3 4 3 4 3 4 4 12 3 3 3 3 3
Similarly, elements of S 2 – row in table 3 will be
11 11 3 11 1 11 1 1 11 8 2 11 11 11 11
0, 0 0 0, ,1 0 1, 0 1 ,15 3 4
4 3 4 3 4 3 4 4 4 12 3 3 3 3 3
Table 3 is now completed.
Table 3
Cj 2 5 0 0 0
CB Basis x1 x2 S1 S2 S3 b
1 1
5 x2 0 1 0
3 5
3
0 S2 0 0 2 1 11 4
3 3
2 x1 1 0 1 0 4 4
3 3
Zj 2 5 1 0 1 33
Cj Z j 0 0 1 0 1
Third feasible solution
Step 7 . Check third feasible solution for optimality.
Z j – row and C j Z j – row values are calculated in 3 . Since all C j Z j , values are negative or
zero, third feasible solution is optimal. The optimal solution is given by
x1 4,
S1 0,
x2 5, (basic)
non basic
S2 4,
S3 0,
Z 33.
Exercise
Solve by simplex method the following L.P. problems:
(a) Maximize Z 4 x1 3x2 6 x3
2 x1 3x2 2 x3 440,
4 x1 3x3 470,
2 x1 5 x2 430,
x1 , x2 , x3 0.
(b) Maximize Z 2 x1 x2
x1 2 x2 10,
x1 x2 6,
x1 x2 2,
x1 2 x2 1,
x1 , x2 0.
You might also like
- PPTs - Set Theory & Probability (L-1 To L-6)No ratings yetPPTs - Set Theory & Probability (L-1 To L-6)49 pages
- BMS 100 STUDENT NOTES NOV 2020 (1) - WatermarkNo ratings yetBMS 100 STUDENT NOTES NOV 2020 (1) - Watermark61 pages
- BCA Discrete Mathematics Unit 1 Set TheoryNo ratings yetBCA Discrete Mathematics Unit 1 Set Theory34 pages
- Mathematical Tools For Economics II - 23april2015No ratings yetMathematical Tools For Economics II - 23april201587 pages
- Module 1 Functions Limits and ContinuityNo ratings yetModule 1 Functions Limits and Continuity23 pages
- SSS Syllabus Mathematics For Business and EnterpriseNo ratings yetSSS Syllabus Mathematics For Business and Enterprise23 pages
- Lesson 2 - Mathematical Language and SymbolsNo ratings yetLesson 2 - Mathematical Language and Symbols46 pages
- Foundational Mathematics For Tertiary STNo ratings yetFoundational Mathematics For Tertiary ST165 pages
- 21feb INF109 MathematicsForComputing I CompletedDraft Units 1-6 EditedOn 21feb2025No ratings yet21feb INF109 MathematicsForComputing I CompletedDraft Units 1-6 EditedOn 21feb2025290 pages
- MTH111-Algebra and Trigonometry-Alhassan Charity Jumai-2019No ratings yetMTH111-Algebra and Trigonometry-Alhassan Charity Jumai-201946 pages
- Set Theory: Prepared by Lec. Kashfia MaishaNo ratings yetSet Theory: Prepared by Lec. Kashfia Maisha29 pages
- Elementary Linear Algebra 10th Edition 250102 225743No ratings yetElementary Linear Algebra 10th Edition 250102 22574345 pages
- BSC Hons /information Systems/ 2 Year, Semester 1: Computer Quantitative MethodsNo ratings yetBSC Hons /information Systems/ 2 Year, Semester 1: Computer Quantitative Methods19 pages
- MTH 111 Algebra and Trigonometry Lecture Notes 20182019No ratings yetMTH 111 Algebra and Trigonometry Lecture Notes 2018201946 pages
- Topics in Finite and Discrete Mathematics - Sheldon M. Ross100% (1)Topics in Finite and Discrete Mathematics - Sheldon M. Ross279 pages
- Mathematics in The Modern World Chapter 2 Quiz0% (1)Mathematics in The Modern World Chapter 2 Quiz2 pages
- How To Pass Discrete Mathematics in One DayNo ratings yetHow To Pass Discrete Mathematics in One Day19 pages
- MAT1005 - BUSINESS-MATHEMATICS - TH - 1.0 - 1 - MAT1005 Business MathematicsNo ratings yetMAT1005 - BUSINESS-MATHEMATICS - TH - 1.0 - 1 - MAT1005 Business Mathematics3 pages
- Xi Study Ir Ms Ay 2024-2025 Jee Micro SchedulesNo ratings yetXi Study Ir Ms Ay 2024-2025 Jee Micro Schedules3 pages
- UPCAT 2026 Free Review Series (March 15-16, 2025)No ratings yetUPCAT 2026 Free Review Series (March 15-16, 2025)314 pages
- Semester-4 MCA Integrated IIPS DAVV SyllabusNo ratings yetSemester-4 MCA Integrated IIPS DAVV Syllabus10 pages
- Measure, Integration and A Primer On Probability Theory: Stefano GentiliNo ratings yetMeasure, Integration and A Primer On Probability Theory: Stefano Gentili458 pages
- Teaching Practice Lesson Plan Maths BY UMAMA AWANNo ratings yetTeaching Practice Lesson Plan Maths BY UMAMA AWAN5 pages
- Formal Languages, Automata and Computation: Slides For 15-453 Lecture 1 Fall 2015 1 / 25No ratings yetFormal Languages, Automata and Computation: Slides For 15-453 Lecture 1 Fall 2015 1 / 2556 pages