Mathematics I Egiovanis@adu - Edu.tr
Mathematics I Egiovanis@adu - Edu.tr
[email protected]
Outlet
• Linear and Quadratic Functions
• Graphs
• Mathematics for Finance
• Logarithms
• Differentiation of one Variable
• Applications in Economics and Business
Evaluation
• One piece of homework 10% (upload on 25
October and 12 December 2021 deadline)
• Mid-term exam 30%
• Final Exams 60%
Introduction
In every day speech we often hear economists
say things like
“ interest rates are a function of oil prices”,
“pension income is a function of years worked”
9
Functions in general
Example Taxidriver
What does a taxi ride cost me with company A?
• Base price: 5 Euro
• Per kilometer: 2 Euro
Price of a 7 km ride?
price 5 2 7 19
Functions in general
Example Taxidriver
What does a taxi ride cost me with company A?
• Base price: 5 Euro
• Per kilometer: 2 Euro
Price of a 7 km ride?
price 5 2 7 19
Functions in general
Example Taxidriver
What does a taxi ride cost me with company A?
• Base price: 5 Euro
• Per kilometer: 2 Euro
Price of an x km ride?
y 5 2x
Functions in general
Example Taxidriver
What does a taxi ride cost me with company A?
• Base price: 5 Euro
• Per kilometer: 2 Euro
Price of an x km ride?
y 5 2x
Functions in general
Definition
• x and y : VARIABLES
(length of ride in km) (price of ride in euro)
• y depends on x: INPUT OUTPUT
x y
y: DEPENDENT VARIABLE
x: INDEPENDENT VARIABLE
Three representations
Functions in general
Three representations
First way: Most concrete form!
Through a TABLE, e.g. for y = 2x + 5:
x y
0 5
1 7
2 9
… …
But: limited number of values no overall picture
Functions in general
Three representations
Second way: Most concentrated form!
formula y = 2x + 5:
EQUATION OF THE FUNCTION
Functions in general
Three representations
x y
Third way: y
0 5
Most visual form! 7
6 1 7
Through the GRAPH 5
rectangular coordinate system: 4
x-coordinate, y-coordinate 3
2
1
-4 -3 -2 -1 0 1 2 3 4 x
-1
Functions in general
Three representations y
14
Third way:
Most visual form!
x
1 5
• Y is a linear function of X
Y a bX
– Table 1.A.1 shows some value of the linear
function Y = 3 + 2X
• Y is a nonlinear function of X
– This includes X raised to powers other than 1
– Table 1.A.1 shows some values of a quadratic
function Y = -X2 + 15X
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Table 1: Values of X and Y for Linear and Quadratic
Functions
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Graphing Functions of One Variable
• Graphs are used to show the relationship
between two variables
• Usually the dependent variable (Y) is shown
on the vertical axis and the independent
variable (X) is shown on the horizontal axis
– However, on supply and demand curves, this
approach is reversed
35
Linear Function
Y-axis
10
5
Y-intercept 3
X-axis
-10 -5 0 1 5 10
X-intercept
-5
-10
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Intercept
• The general form of a linear equation is
Y = a + bX
• The Y-intercept is the value of Y when when X
equals 0
– Using the general form, when X = 0, Y = a, so this
is the intercept of the equation
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Slopes
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Slopes
• 5 - (-12) + (-3)
• 6 -(+77) -(-77)
• 4 - 7 + (-8) + 9
Sample exercise 2
• 4 /(-2)
• (-6) x (+3)
5 - 25 + 75 = 5(1-5+15)=5(11)
- 3 - 9 + 12=3(-1-3+4)=3(0)
Or -3(1+3-4)=-3(0)
• Multiply out:
3 x (4 + 100)= 12+300=312
Or 3x104=312
- 6 x (15 - 2)
-90+12=-78
Or -6x13=-78
Sample exercise 4
• If GDP (a measure of national production of
goods and services) fell by 3.5% between 1990
and 1991, and rose by 2.5% between 1991
and 1992, what was the level of GDP in 1992
as (a) a proportion and (b) a percentage of
GDP in 1990?
Sample exercise 4 (cont.)
• Assume GDP(1990) was, say, 500 billion euros.
Then GDP(1991) was:
• 500*(96.5/100)=482.5 (billion Euros or TL or Yen)
And the GDP(1992) was:
• 482.5 *(102.5/100)= 494.5625
• Proportion:
• 494.5625/500= 0.989125
Sample exercise 4 (cont.)
• Assume GDP(1990) was, say, 100 billion euros.
Then GDP(1991) was:
• 100*(96.5/100)=96.5 (billion Euros or TL or Yen)
And the GDP(1992) was:
• 96.5 *(102.5/100)= 98.9125
• Proportion:
• 98.9125 /100= 0.989125
Example 1
• An engineering firm makes metal
components. Each component requires 0.01
tonnes of steel, 0.5 hours of labour plus 0.5
hours of machine time. Let the number of
components produced be denoted by x.
Derive algebraic expressions for:
• (a) the amount of steel required;
• (b) the amount of labour required;
• (c) the amount of machine time required
• (a) the amount of steel required;
0.01X
• (b) the amount of labour required;
0.5X
• (c) hours of machine time;
0.5X
Example 2
• If the price per tonne of steel is given by r, the
price per hour of labour is given by w and the
price per hour of machine time is given by m,
then derive an expression for the total
production costs of the firm in the Example 1
• Quantityp=x/12
• Pricep=x*p/12
Example 3
• The petrol consumption of your car is 12 miles
per litre. Let x (6) be the distance you travel in
miles and p (2) the price per litre of petrol in
pence. Write expressions for
• (a) the amount of petrol you use and
• (b) your expenditure on petrol.
• Quantityp=6/12=0.5
• Pricep=6*2/12=1
Example 4
• When the UK government privatized the Water
Authorities in 1989 it decided that annual
percentage price increases for water would be
limited to the rate of inflation plus z, where z was
a figure to be determined by the government.
Write an algebraic expression for the maximum
annual percentage price increase for water and
evaluate it for an inflation rate of 6% and a z
factor of 3%.
π+z
Example 5
• The basic hourly rate for a weekly paid worker is £8
and any hours above 40 are paid at £12. Tax is paid at
a rate of 25% on any earnings above £80 a week.
Assuming hours worked per week (H) exceed 40,
write an expression for net weekly wage in terms of
H and then simplify it.
• Solution
• gross wage = 40 × 8 + (H − 40)12 = 320 + 12H − 480 =
12H − 160
• net wage = 0.75(gross wage − 80) + 80 = 0.75(12H −
160 − 80) + 80 = 9H − 120 − 60 + 80 = 9H − 100
Example 6
• If income tax is levied at a rate of 22% on annual
income over £5,400 then:
• (a) write an expression for net monthly salary in
terms of gross monthly salary (assumed to be
greater than £450), and
• 450+(X-450)*0.78=450+0.78X-351=99+0.78X
• (b) evaluate it if gross monthly salary is £2,650
• 99+0.78X=99+0.78*2,650=2,166
Example 7
• Someone is booking a meal in a restaurant for
a group of people. They are told that there is a
set menu that costs £9.50 per adult and £5
per child, and there is also a fixed charge of £1
per head for each meal served. Derive an
expression for the total cost of the meal, in
pounds, if there are x adults and y children.
• TC=9.5x+5y+1(x+y)=10.5x+6y
Example 8
• A firm produces a good which it can sell any
amount of at £12 per unit. Its costs are a fixed
outlay of £6,000 plus £9 in variable costs for each
unit produced. Write an expression for the firm’s
profit in terms of the number of units produced.
• Profit=revenue-cost
• Profit=12x-9x-6,000 where 12x=revenue
• And 9x+6,000=variable costs + fixed costs
• Profit=3x-6,000
Example 9
Test Yourself, Exercise 3.9 page 75
• You are studying a subject which is assessed by
coursework and examination with the total mark for
the course being calculated on a 30 : 70 weighting
between these two components. Assuming you score
60% in coursework, insert the appropriate inequality
sign between your possible overall mark for the course
and the percentage figures below.
• (a) 18% ? overall mark
• (b) 16% ? overall mark
• (c) 88% ? overall mark
• (d) 90% ? overall mark
• Since I got 60 and the weight is 30%, then the part of the coursework is:
• 60x0.30=18
• The maximum I can get in the final exams is 100. Using the weight of 70%
or 0.70 I have:
• 100x0.7=70