APPM1004 — Revision Lectures 1

Revision Lecture # 9
Relative Extrema — 2nd Derivative Test

Outcomes of this lecture

After studying this lecture and practising examples you will be able to:

1.) use the second derivative test to determine the relative extrema of a function.

2.) create a quadratic model and determine the maximum value of the function using the
2nd derivative test.

3.) find the minimum value of an inventory/production model using the 2nd derivative test
and answer related questions.

Pre-knowledge and Skills

You will need to be completely familiar with

1.) identifying critical values of a function and

2.) the graphical representation of functions.

3.) the rules of differentiation.

4.) solving equations.

5.) the notation for closed and open intervals on the real number line.
APPM1004 — Revision Lectures 2

Revision Lecture # 9
Relative Extrema — 2nd Derivative Test

ˆ The second derivative test is a quick, alternative method for determining the relative
maxima and minima of a function.

ˆ It is most useful when the second derivative is easily found.

ˆ If the second derivative is algebraically complicated to find, then it is best to use the
first derivative test.

ˆ To determine the relative extrema of a function f (x), using the 2nd derivative test,
apply the following five steps.

Step 1.

◦ Identify any values of x for which the function is undefined.

Step 2.

◦ Differentiate the function.

Step 3.

◦ Identify 
any critical values, x = c, by
 f 0 (x) = 0,
Solving
 f 0 (x) undefined, excluding any values from Step 1.
Step 4.

◦ Differentiate the function again.

Step 5.

◦ Substitute only the critical values x = c, from Step 3 into the second deriva-
tive.
◦ If f 00 (c) > 0, then f (c) is a relative minimum.
◦ If f 00 (c) < 0, then f (c) is a relative maximum.
◦ If f 00 (c) is undefined or f 00 (c) = 0. then use the first derivative test to deter-
mine whether there is a relative minimum or maximum or point of inflection
at ( c , f (c) ).
APPM1004 — Revision Lectures 3

Revision Lecture # 9
Relative Extrema — 2nd Derivative Test

ˆ Example 1
Use the second derivative test to determine the extrema and points of inflection (if
any), of the function,
f (x) = (x − 9)(x − 3)2 .

Step 1. Identify any values of x for which the function is undefined.

◦ f (x) is defined for all values of x.

Step 2. Differentiate the function.

f 0 (x) = (1)(x − 3)2 + (x − 9)2(x − 3) (Using the product rule.)

= (x − 3)(x − 3 + 2(x − 9)) (Factorising out (x − 3).)
= (x − 3)(3x − 21)
⇒ f 0 (x) = 3(x − 3)(x − 7)

Step 3. Identify any critical values.

◦ f 0 (x) = 0 when 3(x − 3)(x − 7) = 0 ie. when x = 3 or x = 7.

◦ f 0 (x) is defined for all values of x.

Step 4. Find the second derivative.

f 00 (x) = 3(1)(x − 7) + 3(x − 3)(1) (Using the product rule.)

= 3x − 21 + 3x − 9 (Simplifying.)
= 6x − 30
⇒ f 00 (x) = 6(x − 5)

Step 5. Substitute the critical values,x = 3 and x = 7, from Step 3, into f 00 (x).

◦ f 00 (3) = 6(3 − 5) < 0 ⇒ f (x) is concave down at x = 3.

\
Therefore f (3) is a relative maximum. %

◦ f 00 (7) = 6(7 − 5) > 0 ⇒ f (x) is concave up at x = 7.

[
Therefore f (7) is a relative minimum. &
APPM1004 — Revision Lectures 4

Revision Lecture # 9
Relative Extrema — 2nd Derivative Test

ˆ Example 1 graph

ˆ Example 2
Use the second derivative test to determine the extrema and points of inflection (if
any), of the function,
1 4 1 3
f (x) = x + x.
12 6

Step 1. Identify any values of x for which the function is undefined.

◦ f (x) is defined for all values of x.

Step 2. Differentiate the function.

1 3 1 2
f 0 (x) = x + x (Power rule)
3 2
1 2
= x (2x + 3) (Factorising)
6
Step 3. Identify any critical values.
3
◦ f 0 (x) = 0 when x = 0 or x = − = −1,5.
2
0
◦ f (x) is defined for all values of x.
APPM1004 — Revision Lectures 5

Revision Lecture # 9
Relative Extrema — 2nd Derivative Test

ˆ Example 2 cont.

Step 4. Find the second derivative, ⇒ f 00 (x) = x2 + x

Step 5. Substitute the critical values,x = 0 and x = −1,5, from Step 3, into f 00 (x).

◦ f 00 (−1, 5) = (−1, 5)2 + (−1, 5) = 0, 75 > 0 ⇒ f (x) is concave up at x = −1,5.

[
Therefore f (−1, 5) is a relative minimum. & .

◦ f 00 (0) = 02 + 0 = 0? Use the first derivative test here.

1
* −1 < 0 ⇒ f 0 (−1) = (−1)2 (2(−1) + 3) > 0.
6
f (x) increases for values of x < 0.
1
* 1 > 0 ⇒ f 0 (1) = (1)2 (2(1) + 3) > 0.
6
f (x) continues to increase for values of x > 0.
* Therefore ( 0 , f (0)) is a horizontal point of inflection.
(Horizontal because f 0 (0) = 0.)

Example 2 graph
APPM1004 — Revision Lectures 6

Revision Lecture # 9
Relative Extrema of a marginal function — 2nd Derivative Test

ˆ Example 3
A business’s total revenue t months from now is given by the function

1 4 5 3
R(t) = − x + x − 8x2 + 30x + 10.
12 3

Use the second derivative test to determine when the total revenue is increasing most
rapidly.

◦ The phrase “increasing most rapidly” means the “maximum rate of change” or,
in this particular case, the “maximum marginal revenue”.

◦ To get the answer to this question you are required to maximise the derivative
function R0 (t) .

Step 1. Find the marginal revenue.

1
◦ R0 (t) = − x3 + 5x2 − 16x + 30.
3
1
◦ Re-label the marginal revenue, M(t) = − x3 + 5x2 − 16x + 30.
3
◦ The aim now is to find when M(t) reaches a maximum.

Step 2. Find the critical values of M(t).

◦ M 0(t) = −x2 + 10x − 16.

◦ M 0(t) = −(x − 2)(x − 8) = 0 when x = 2 or x = 8.

Step 3. Find the second derivative of M(t) and test for the maximum.

◦ M 00(t) = −2x + 10.

◦ M 00(2) = −2(2) + 10 = 6 > 0 ⇒ M(2) is a relative minimum.

◦ M 00(8) = −2(8) + 10 = −8 < 0 ⇒ M(8) is a relative maximum.

Step 4. The total revenue is increasing most rapidly eight months from now.
−−−−−−−−−−−−−−−−−−→
APPM1004 — Revision Lectures 7

Revision Lecture # 9
Applications of the Second Derivative Test

ˆ The Quadratic Model

ˆ Given the following problem.

When the unit price, p of a commodity is R30 then 1200 units will be sold. However,
sales will decrease by 150 units for each R10 increase in the price. Find the price that
will give the maximum revenue from the sale of the product.

ˆ To solve this problem follow these Steps.

Step 1. Let x be the number of R10 price increases.

Step 2. Write price and quantity as expressions in terms of x

◦ price = 30 + 10x
◦ quantity = 1200 − 150x

Step 3. Revenue = price × quantity

◦ R(x) = (30 + 10x)(1200 − 150x) = 36 000 + 7 500x − 1 500x2

Step 4. Solve for the critical value.

◦ R0 (x) = 7 500 − 3 000x

◦ R0 (x) = 0 ⇒ 3 000x = 7 500 ⇒ x = 2, 5.

Step 5. Test for the relative maximum

◦ Find R00 (x) = −3 000 < 0

◦ ∴ R(x) is concave down at x = 2, 5 ⇒ R(2, 5) is a relative maximum.

Step 6. Evaluate the price that gives the maximum revenue.

◦ Remember that x is the number of price increases.

◦ Substitute x = 2, 5 into the price function 30 + 10x.
◦ p = 30 + 10(2, 5) = R55.
◦ The revenue will be maximised when the unit price is R55.
−−−−−−−−−−−−−→
APPM1004 — Revision Lectures 8

Revision Lecture # 9
Applications of the Second Derivative Test

ˆ Production and Inventory control

A commodity is produced in equal sized batches at regular intervals throughout the
year.

◦ M is the total number of items to be produced in one year.

◦ M = (the number of items per batch) × (the number of batches).

◦ f is the cost of setting up one batch for production.

◦ g is the cost of producing just one item.

◦ k is the cost to store one item for one year.

ˆ If x is the number of batches produced per year then,

◦ the total annual cost to produce M items is given by the function,

M
T (x) = f x + gM + k rands,
2x
M
◦ the number of items per batch = and
x
365
◦ a batch is produced every days.
x

ˆ If x is the number of items in one batch then,

◦ the total annual cost to produce M items is given by the function,

M x
T (x) = f + gM + k rands.
x 2
M
◦ the number of batches = and
x
365
◦ a batch is produced every days.
M/x
ˆ NB: the derivative of gM is zero because both g and M are constants.
APPM1004 — Revision Lectures 9

Revision Lecture # 9
Applications of the Second Derivative Test

ˆ Example 4
A retailer has a total demand for 4 000 units of a product per year. Since the retailer
cannot store that many items at once, she places regular equal orders for the items
throughout the year. The total cost of ordering and storing the product is given by
the function,
M x
T (x) = f + gM + k ,
x 2
where x is the number of items per order, M is the total annual demand, f , the cost
of placing an order, is R16, g, the cost of each item, is R10 and k, the cost of storing
one item for one year, is R5.

In order to minimise the total annual cost of ordering and storing the items, determine

a. the size of each order.

b. the number of orders that should be placed during the year.

c. how often an order should be placed.

fM k 2f M
Step 1. T 0 (x) = − 2
+ and T 00 (x) =
x 2 x3
k fM 2f M 2(16)(4000)
Step 2. T 0 (x) = 0 when = 2 ⇒ x2 = =
2 x k 5
√
⇒ x = 25 600 = 160 items per order. (Ignore negative values of x as they are
not practical.)
2(16)(4 000)
Step 3. T 00 (160) = > 0 ⇒ T (x) is concave up at x = 160 ∴ T (160) is a
1603
relative minimum.
Answers:

a. 160 items per order.

4 000
b. = 25 orders per year.
160
365
c. An order should be placed every = 14, 6 days.
25
APPM1004 — Revision Lectures 10

Revision Lecture # 9
Exercises for the Second Derivative Test

1. Given the derivative of f (x),

f 0 (x) = −x2 + 3x + 10,

a. Find the critical values of the function.

b. use the second derivative test to identify the x value at which f (x) has a relative
maximum and the x value at which f (x) has a relative minimum.

NB: Do not change the sign of the first derivative before finding the second derivative.

2. Given that the function f (x) has critical points at x = 2 and x = 7 and a vertical
asymptote at x = 3, use the second derivative,

x2 − 6x − 14
f 00 (x) = ,
(x − 3)2

to determine whether the values f (2) and f (7) are relative maxima or relative minima.

3. The total cost to produce x items is given by the function

1
C(x) = x4 − 5x3 + 24x2 + 90x − 10.
4

Find the production level at which the marginal cost is at a minimum.

4. Six thousand units of a product are sold when the unit price of the product is R45.
However, sales will decrease by one hundred units every time the unit price increases
by R2, 50. Determine the unit price that will maximise the revenue from the sale of
the product.
APPM1004 — Revision Lectures 11

Revision Lecture # 9
Exercises for the Second Derivative Test

5. A retailer has an annual demand (M ) for 1 200 items of a product. Each item costs
the retailer R 75 (g), the cost of placing an order is R8 (f ), and the cost of storing an
item for one year is R3 (k). The total annual cost to make and store the product is

M kx
T (x) = f + gM + rands
x 2

where x is the number of items per order. To minimise the total annual cost of
ordering and storing the items, determine

(a) the size of each order,

(b) how many orders should be placed every year and

(c) how often in a year (rounded to one decimal place) an order should be placed.

6. A manufacturer has an annual demand (M ) for 7 000 units of a product. It costs the
manufacturer R75 to make one unit of the product (g), R125 to set up the factory to
be able to make the product (f ) and R7 to store one unit of the product for one year
(k). The total annual cost to make and store the product is

kM
T (x) = f x + gM + rands
2x

where x is the number of batches manufactured every year. To minimise the total
annual cost, determine

(a) how many batches should be manufactured every year,

(b) how often in a year (rounded to the nearest day) a batch should be manufactured
and

(c) how many units should be made per batch.