Notation and Preliminaries

Math Econ (MEF)

Raúl Bajo ([email protected])

Basic Concepts
• Notation

. ∀ means “for all...” or “for every...”.

. ∃ means “there exist(s) such...”.
. ∈ means “that is an element of...” or “that are elements of...”.
. ⊂ (or ⊆) means “that is a subset of...” or “that are subsets of...”.
. A = {x | ∀ x ∈ B, 0 < x < 1} means “A is the set of all x’s where for
every x that is an element of set B, x is greater than zero and less
than one”. This could also be read as “A is the set of all elements
that are in set B and that are between zero and one, exclusive”.
P
. is the summation operator. Π is the product operator.

• “PEMDAS”: parentheses, exponents, multiplication, division, addition,

subtraction = order of operations.
• Addition

. Commutativity: a + b = b + a
. Associativity: a + (b + c) = (a + b) + c
. The additive identity is zero: a + 0 = a
. The additive inverse of a is −a : a + (−a) = 0, the additive identity.
. Subtraction can be thought of as a version of addition in the sense
that a − b = a + (−b)

• Multiplication

. Commutativity: ab = ba
. Associativity: (ab)c = a(bc)
. The multiplicative identity is one: a(1) = a
The multiplicative inverse of a is a1 : a a1 = 1a


.
a = 1, the multiplica-
tive identity. Zero has no multiplicative inverse.
. Zero element: a(0) = 0
. Sign rules: a(b) = ab, a(−b) = (−a)b = −ab, and (−a)(−b) = ab

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 . Division: can be thought of as
a version of multiplication in the sense
that a ÷ b = ab = a/b = a 1b . Zero has no multiplicative inverse,
because 10 does not exist.
. Distributivity: a(b + c) = ab + ac = ba + ca = (b + c)a

• Exponent rules

. an = |a · a ·{za · · · a}
n times
. an am = an+m
. (ab)n = an bn
an a−m
.
am = a
n m nm
. (a ) =a
0
. a =1
. a−n = 1
an

• Logarithms and natural log

. If x = by , then y = logb x
. logb (xy) = logb x + logb y
 
. logb xy = logb x − logb y
. logb xy = y(logb x)
loga x
. logb x = loga b
Generally we work with log base e (Euler’s number) ≈ 2.7183... and
this can be also written as ln x.

Basic Logic
• Given two statements, P (for example, “it rains”) and Q (for example, “I
take my umbrella”). “If P is true, then Q is true” is denoted by P ⇒ Q.
And we say that P is a sufficient condition for Q, and that Q is a necessary
condition for P . We can also say P implies Q.

• if P ⇒ Q and Q ⇒ P both hold, it is denoted by P ⇐⇒ Q. And we

say that P (Q) is a sufficient and necessary condition for Q(P ), P (Q) is
equivalent to Q(P ), or P (Q) iff (i.e., if and only if) Q(P ).
• The negation of P is denoted by ∼ P . The contrapositive of P ⇒ Q is
∼ Q ⇒∼ P . We have that “P ⇒ Q” ⇔ “∼ Q ⇒∼ P ”. If P is not true,
we say “P ⇒ Q” is vacuously true.

. Exercise: Consider this statement P : “∀a ∈ A, such property of a is

true”. How do you state ∼ P ?
Solution: ∃ a ∈ A, for which such property of a is not true.

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Basic Proof Techniques
• The most obvious proof technique is deductive reasoning.

. Exercise: Prove deductively that the sum of six consecutive positive

numbers is a multiple of three.
Proof: Consider six consecutive positive numbers x, x + 1, x + 2, x +
3, x+4, x+5. The sum of them is equal to 6x+15. 6x+15
3 = 2x+5.

• Prove by contrapositive. If we want to prove that “P ⇒ Q”. It is equiva-

lent to prove that “∼ Q ⇒∼ P ”.

. Exercise: Prove that if x2 is even, then x is even.

Proof: Suppose x is not even. Then x is odd. The product of two
odd numbers is odd, hence x2 = x · x is odd. Thus x2 is not even.

• Prove by contradiction (very important!). It is similar to contrapositive

√
. Exercise: Prove that 2 is irrational.
√
Proof: Assume for the sake of contradiction
√ (a.f.s.o.c.) that 2 is
rational. Then, ∃ a, b ∈ Z such that 2 = ab . Without loss of gen-
erality (w.l.o.g.) assume that @ c ∈ Z, c 6= 1, such that ac and cb are
√
integers (Z) –i.e. the fraction is in simplest form. Rewrite 2 = ab
as 2b2 = a2 . We notice that a2 is always even, which means that a is
even (see proof below). Therefore, a can be defined as a = 2k, k ∈ Z.
Therefore, (2k)2 = 2b2 , that is 2k 2 = b2 , which means that b is even.
√
If 2 = ab , we have just proved that both a and b must be even and
so are both multiples of 2. However, we have assumed that @ c ∈ Z,
c 6= 1, such that ac and cb are integers (Z). We have arrived to a
√
contradiction. Therefore, 2 must be irrational.

. Exercise: Prove that there are infinitely many prime numbers.

Proof: a.f.s.o.c. that there are n prime numbers, where n is a finite
number, denoted as p1 , p2 , ... , pn . We construct a new number
P (greater than 1) as follows: P = p1 × p2 × · · · × pn + 1. Since
p1 , p2 , ... , pn constitute all prime numbers, P cannot be prime.
Therefore, it must be divisible by at least one of the finitely many
primes. However, the number P has remainder 1 when divided by
any prime pi , i ∈ {1, 2, · · · , n}. Therefore, P is a prime number.
This contradicts our assumption that there are n prime numbers.
Therefore, there are infinitely many prime numbers.

• Prove by mathematical induction, which could be used to prove certain

statements about integers. Two steps: (1) P (n) is true if n = 1 (2)
P (n + 1) is true, if P (n) is true. .

. Exercise: Prove that ∀ n > 1, 8n − 3n is divisible by 5.

Proof: (1) For n = 1, we have 81 − 31 = 8 − 3 = 5, which is clearly
divisible by 5.
(2) Assume, for n = m, that 8m − 3m is divisible by 5.

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 For n = m+1, we have 8(m+1) –3(m+1) = 8(m+1) –(3)8m +(3)8m –3m+1 =
(8 − 3)8m + 3(8m − 3m ) = (5)8m + 3(8m − 3m ).
The first term, (5)8m , is divisible by 5 (it has 5 as a factor). The
second term, 3(8m − 3m ) is divisible by 5 (by assumption). Since we
can factor a 5 out of both terms, then the entire expression, (5)8m +
3(8m − 3m ), must be divisible by 5.

Elementary Set Theory

• Set = a collection of elements/objects
Some mathematical examples: S = {2, 3, 4}, I = {x | x is a positive integer}
or {x | x ∈ N}, J = {y | 3 < y < 6}.
• A ⊂ B: for all a ∈ A, we have a ∈ B.
• C = {2, 4, 6, 8} and D = {2, 4}. D is a subset of C because every element
in D is an element of C. In general, D ⊂ C iff x ∈ D implies x ∈ C.

. Exercise: How many subsets of J are there if J = {1, 2, 3, 4, 5}?

Solution: There are 25 = 32 subsets. ∅, {1, 2, 3, 4, 5}, {1}, {1, 2}, ...

• A = B: A ⊂ B and B ⊂ A.

. Exercise: What is the relation between A = {1, 3, f, g} and B =

{g, 3, f, 1}?
Solution: A = B.

• A $ B: A ⊂ B but A 6= B.
• C = A ∪ B: C = {x | x ∈ A, or x ∈ B}.
The union of several sets is the set that contains all elements found in any
of the sets of which the union is composed.
• C = A ∩ B: C = {x | x ∈ A, and x ∈ B}.
The intersection of several sets is the set that contains all the elements
common to all the sets in the given intersection.
We usually say that a set of sets is a collection Sof sets. For the
S union (or


intersection) of a collection of sets G, we write Gi ∈G Gi or Gi ∈G Gi .

Suppose there is a universal set U which contains all the elements that
exist in the context of the given discussion, then,

. A = B c (or denoted by B̃): A = {x | x ∈ U, x ∈

/ B}.
. A \ B (or denoted by A − B) = A ∩ B c .
The complement of a given set A is the set that contains all the
elements in the universal set that are not contained in A. The relative
complement (or difference) of B in A, is the set of elements in A, but
not in B.

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 . ∅ denotes the empty set. ∅ contains no elements and is the comple-
ment of U . ∅ is a subset of any set.
Notice that ∅ is different from {∅}.

• The commutative laws: A ∪ B = B ∪ A, A ∩ B = B ∩ A

• The associative laws: A ∪ (B ∪ C) = (A ∪ B) ∪ C, A ∩ (B ∩ C) = (A ∩ B) ∩ C
• The distributive laws: A ∪ (B ∩ C) = (A ∪ B) ∩ (A ∪ C), A ∩ (B ∪ C) =
(A ∩ B) ∪ (A ∩ C)
• The De Morgan’s laws: (A ∪ B)c = Ac ∩ B c , (A ∩ B)c = Ac ∪ B c

. Exercise: Prove the De Morgan’s law (A ∪ B)c = Ac ∩ B c .

Proof: Let P = (A ∪ B)c and Q = Ac ∩ B c .
(1) Let x be an arbitrary element of P then x ∈ P ⇒ x ∈ (A ∪ B)c
⇒ x ∈ / (A ∪ B) ⇒ x ∈ / A and x ∈ / B ⇒ x ∈ Ac and x ∈ B c ⇒
c c
x ∈ A ∩ B ⇒ x ∈ Q.
(2) Let y be an arbitrary element of Q then y ∈ Q ⇒ y ∈ (Ac ∩ B c )
⇒ y ∈ Ac and y ∈ B c ⇒ y ∈ / A and y ∈/ B ⇒ y ∈ / (A ∪ B) ⇒
y ∈ (A ∪ B)c ⇒ y ∈ P .

Some commonly used sets

• N = {1, 2, 3.......}, the set of natural numbers. Sometimes 0 is included
and the set can be referred to as the “whole numbers”.

• Z = {... − 3, −2, −1, 0, 1, 2, 3...}, the set of integers.

• Q = ab | a, b ∈ Z, b 6= 0 , the set of rational numbers which can be ex-


pressed as a fraction.
• R, the set of real numbers, usually the universal set of numbers in which
we work.
• Qc = R \ Q, the set of irrational numbers.
• C, the set of complex numbers.

Cartesian Products
• Ordered pairs are pairs of elements where the order of elements matters.
So the set {a, b} is unordered while the pair (a, b) is ordered. Ordered
pairs are one kind of ordered set, which is just a generalization of the
concept of ordered pairs.

• Ordered pairs can be elements of a set also. The Cartesian plane is the
most familiar example: all ordered pairs can be found on the cartesian
plane and the Cartesian plane is an infinite set of ordered pairs.

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 • The cartesian product (or direct product) is the set of all possible ordered
pairs that can be constructed where the first element of the ordered pair
comes from the first set and the second element of the ordered pair comes
from the second set. The cartesian product of sets A and B is denoted by
A × B, or “A cross B”.
Formal definition: A × B = {(a, b) | a ∈ A and b ∈ B}.
Two examples: {(x, y) | y = 3x, x, y ∈ R} and {(x, y) | y ≥ x}.

• We can also discuss ordered triples or more. For example, A × B × C =

{(a, b, c) | a ∈ A, b ∈ B, c ∈ C}. So we can have R × R × R = R3 ,
and similarly R4 , R5 , ..., Rn . Actually we can even consider the infinite
cartesian product of an infinite number of sets.

Functions
• Consider sets X and Y . A function is a especial kind of relation where
there is one and only one y-value for any given x-value. Note that a
function can have more than one x-value with the same y-value but not
more than one y-value for a given x-value. Any two-dimensional relation
that does not pass the “vertical line test” is not a function.

. Exercise: Which one can be considered as a function y = f (x), a)

{(x, y) | y = 3x, x, y ∈ R}, or b) {(x, y) | y ≥ x}?
Solution: a) (plot both and compare them).

• A function f is also called a mapping. f : X → Y means a rule which

maps every element x of the domain X to an element y = f (x) of Y , the
image of x. The range of f is the set f (X) = {y ∈ Y | ∃x ∈ X : y = f (x)}.
The set of functions from X into Y is denoted Y X .

• A function f ∈ Y X is onto Y (or surjective, a surjection) if f (X) = Y .

It means that for every element y ∈ Y , there exists at least one element
x ∈ X s.t. (such that) f (x) = y.
• A function f ∈ Y X is one-to-one (or injective, an injection) if x 6= x0 ⇒
f (x) 6= f (x0 ). It means that different x ∈ X’s have different function
values.
• A function f ∈ Y X is a bijection if it is both surjective (a surjection) and
injective (a injection). In this case we say the inverse of f , the function
f −1 : Y → X is defined by y = f (x) ↔ x = f −1 (y). More generally, the
preimage of a subset E ⊂ Y is f −1 (E) = {x ∈ X | f (x) ∈ E}.
• Composition of functions: f ∈ Y X , g ∈ Z Y , g ◦ f (x) = g(f (x)) ∈ Z X . It
is associative, but not commutative.

Cardinality
• Roughly speaking, cardinals are measures of the size of sets. For a set
with a finite number of elements, we just count them. And when we count
them, we are mapping these elements into natural numbers indeed.

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• For two sets X and Y , if there exists a bijection between them, then we
say they have the same cardinal number, |X| = |Y |.

• X is infinite if it is not finite.

X is uncountable if it is neither finite or countable.
• A countable union of countable sets is still countable.
• The cardinal numbers of N and R are denoted by ℵ0 and ℵ1 , respectively.
It can be shown that ℵ0 < ℵ1 (by Cantor’s diagonal argument).
• The power set of a set A, denoted by 2A , is the set of all subsets of A. We
can show that |2A | > |A|, that is, the cardinality of the power set of set A
is strictly greater than the cardinality of set A. As a consequence, there
is no bijection between 2A and A.