Mathematical Techniques For Economic Analysis: Australian National University DR Reza Hajargasht
Mathematical Techniques For Economic Analysis: Australian National University DR Reza Hajargasht
Economic Analysis
P(1950) 2,560,000,000
4
Graph
The most common method for visualizing a function is its graph.
If f is a function with domain D, then its graph is the set of
ordered pairs {(x, f(x)) | x D}
In other words, the graph of f consists of all points (x, y) in the
coordinate plane such that y = f(x) and x is in the domain of f.
x +1
Find domain and range f ( x) =
x −1
Finding Domain
Piecewise Function
A function f is defined by
1 – x if x –1
2
x if x –1
Evaluate f (–2), f (–1), and f (0) and sketch the graph
Absolute value
Step Function
• Plot of |x|
• Step function
0.88 if 0 < w 1
1.05 if 1 < w 2
C(w) = 1.22 if 2 < w 3
1.39 if 3 < w 4
Mathematical Models
10
Decreasing and Increasing Functions
Monotonicity
Symmetry
• .
12
Mathematical Models
13
Catalogue of Essential Functions
• Linear
• Polynomial (Quadratic, Cubic,….)
• Rational
• Algebraic
• Exponential
• Trigonometric
• Logarithmic
• Inverse Trigonometric
14
Linear Function
• When we say that y is a linear function of x, we mean that
the graph of the function is a line, formula for the function as
y = f (x) = mx + b
where m is the slope of the line and b is the y-intercept.
.
15
Polynomial Function
16
Quadratic Function
where m0 is the rest mass of the particle and c = 3.0 x 105 km/s is
the speed of light in a vacuum.
Trigonometric Functions
There are three basic trigonometric functions including sin, cosine
and tangent (there are also secant, cosecant and cotangent)
For both the sine and cosine functions the domain is ( , )
and the range is the closed interval [–1, 1].
|sin x| 1 |cos x| 1
Trigonometric Functions
P = (1436.53) • (1.01395)t
(a) f(x) = 5x
(b) g(x) = x5
(c)
(d) u(t) = 1 – t + 5t 4
Transformation
Solution 1:
If x1 ≠ x2, then x13 ≠ x23 (two different numbers can’t have
the same cube).
Therefore, by Definition 1, f(x) = x3 is one-to-one.
Solution 2:
From Figure 3 we see that no
horizontal line intersects the
graph of f(x) = x3 more than once.
Therefore, by the Horizontal f(x) = x3 is one-to-one.
Line Test, f is one-to-one.
Inverse Function
For example, if f(x) = x3, then f –1(x) = x1/3 and so the cancellation
equations become
f –1(f(x)) = (x3)1/3 = x
f(f –1(x)) = (x1/3)3 = x
Inverse Function
If we have a function y = f (x) and are able to solve this equation for x in terms
of y, then x = f –1(y).
If we want to call the independent variable x, we then interchange x and y and
arrive at the equation y = f –1(x).
Logarithmic Function
If b > 0 and b ≠ 1, the exponential function f(x) = bx is either
increasing or decreasing and so it is one-to-one by the Horizontal
Line Test. It therefore has an inverse function
f –1, which is called the logarithmic function with base b and
is denoted by logb.
Figure 12
Logarithmic Function
Solution:
Using Law 2, we have
= log2 16
=4
because 24 = 16.
Natural Logarithm
Of all possible bases b for logarithms, we will see that the most
convenient choice of a base is the number e. The logarithm with
base e is called the natural logarithm and has a special
notation:
Therefore
In particular
Example
Find x if ln x = 5.
Solution 1:
From (8) we see that
ln x = 5 means e 5 = x
Therefore x = e 5.
Solution:
Formula 10 gives
log8 5 0.773976
Natural Logarithm
You can see from Figure 17 that the sine function y = sin x is not
one-to-one (use the Horizontal Line Test).
Figure 17
Figure 18
Inverse Trigonometric Functions
• Inverse Sin Function: sin -1 or arcsin is the inverse of
the restricted sine function, y = sin(x), [-π/2, π/2]
• The equations y = sin -1 x or y = arcsin x which also
means, sin y = x, where -π/2 < y < π/2, -1 < x < 1
(remember range of f is domain of f -1 and vice versa).