AGUSTIN, RIZALENE S

MATH 112: Business Calculus

APPLICATIONS OF THE DERIVATIVE

I. OPTIMIZATION

Most real-world problems are concerned with maximizing or minimizing some quantity
so as to optimize some outcome.

Here are the steps in the Optimization Problem-Solving Process :

(1) Draw a diagram depicting the problem scenario, but show only the essentials.
(2) Give the diagram symbols.
(3) Analyze the diagram, relating the "knowns" to the "unknowns".
(4) Find the extreme values using the Calculus.
(5) Draw conclusion based on values computed.

EXAMPLE 1: A rope is strung from the tops of two vertical poles. Between the poles, it is tied to a point
on the ground. Show that the shortest length of rope occurs when the two angles that the rope
makes with the ground are equal.

1.

2. Let d = distance between the poles

x = distance between the base of the poles P and tie-point R
P and S = respective height of the poles P and S
L(x) = rope-length based on the variable tie point

3.
4. Now we use the Calculus to determine the

angles: " " and " " and show that they are equal when the rope-length is smallest.
 Set:

5. Since to the left of the value of "x" where and to the

right, " " must be a minimum at .

EXAMPLE 2: A man is trapped in a swamp at the location: . The rescue team must stay as close to
him as possible so that they can pass a rope to him. Find the BEST LOCATION of the rope required to
rescue him.

The best spot for the rescue team must be located somewhere along the swamp boundary.

Let, " " be the distance between the team and the trapped man.
 Set:

The best spot for the rescue team is thus at the location: because this point is closest
to the trapped man.

EXAMPLE 3: A rain gutter is to be constructed from sheet metal "30 cm" wide by bending it "10 cm" in
from both ends. Find the angle of those bends that will result in the maximum water-carrying
capacity.

Capacity is maximum when the gutter's cross-sectional area is greatest. Gutter cross-sectional area,
" ", equals the sum of a rectangular area, " " and two equal triangular areas, each of area,
" ".

Set:
 Reject because this yields a minimum cross-sectional area. The maximum cross-

sectional area is obtained by bending the sheet metal to an angle, . A sign change in
the slope from plus to minus at that value of "q" confirms that a maximum occurs there.

The maximum gutter cross-sectional area is thus

EXAMPLE 4: Find the dimensions that will minimize the cost of the metal to manufacture a circular
cylindrical can of volume, " ".

Minimum surface area," ", results in minimal cost of material to manufacture.

But the can must have the volume, " ".

Now we have "A" as a function of only one variable, "r". The volume, " ", is a constant even
though its value is unspecified.

Set:
 Solve for "r".

Note that the height is twice the radius.

We use the second derivative test to confirm that we have determined the dimensions
that yield the minimum surface area for the can.

EXAMPLE 5: Find the most advantageous length of a lever to raise a weight of 500 lbs. if the distance

of the weight from the fulcrum is 1 ft. and the lever weighs .

The most advantageous lever is the one that requires the least force, "P", to lift the system. The sum of
all of the moments must be zero. Let "L" be the length of the lever.

Solve for "P" in terms of "L".

 Set:

The second derivative test confirms that this value of "L" results in a minimum value for
"P".

EXAMPLE 6: A cone is made from a circular sheet of radius, " R ", by cutting out a sector and gluing
the cut edges of the remaining piece together. What is the maximum attainable volume for the
cone?

If "h" is the height of the cone, then the volume, "V", of the cone can be expressed in terms of "h" and
"R", the radius of the sector.

Since "R" is a constant, only "h" can vary.

Set:
 The second derivative test confirms that this value of "h" results in a maximum value for " ".

EXAMPLE 7: A lamp is suspended above the center of a round table of radius, "r". How high above
the table should the lamp be placed to achieve the maximum illumination at the edge of the table?
[Assume that the illumination, " ", is directly proportional to the cosine of the angle of incidence, " ",
of the light rays and inversely proportional to the square of the distance, " ", from the light source.]

" " is the constant of proportionality.

Let "h" be the height of the lamp above the table.

Set:
 We confirm that this value of "h" results in the maximum illumination by noting

that to the left of that value of " " and to the right of that value of "h ".

EXAMPLE 8: Find the absolute maximum and minimum values of f(x) = 3x2 − 9x on the interval [−1, 2].

Answer: By the Intermediate Value Theorem the function f attains its maximum and minimum
values on [−1, 2].

To find those global extrema we evaluate and compare the values of f at the endpoints and critical
numbers that belong to (−1, 2).

From f’(x) = 6x − 9 = 3(2x − 3) we conclude that the critical number is x = 3/2 .

From f(−1) = 12, f(2) = −6, and f (3/2) = − 27/4 we conclude that the maximum value is f(−1) = 12 and
the minimum value is f (3/2) = − 27/4 .

EXAMPLE 9: The sum of two positive numbers is 12. What is the smallest possible value of the sum of
their squares? Show your reasoning.

Answer: The question is to find the minimum value of the function

f(x) = x 2 + (12 − x)2, x ∈ (0, 12).

From f’(x) = 4(x − 6) it follows that x = 6 is the only critical number.

From f”(6) = 4 > 0, by the second derivative test, it follows that f(6) = 72 is the minimum value of
the function f

EXAMPLE 10: Find the dimensions of the rectangle of largest area that has its base on the x-axis and its
other two vertices above the x-axis and lying on the parabola y = 12 − x2

Let (x, 0) be the bottom right vertex of the rectangle.

The question is to maximize f(x) = 2x(12 − x 2 ), x ∈ (0, 2 √ 3).
The only critical number is x = 2.
The length of the rectangle with the largest area is 4 and its height is 8.
II. APPLICATIONS OF DERIVATIVES TO BUSINESS AND ECONOMICS
Management, whether or not it knows calculus, utilizes many functions of the sort we have
been considering. Examples of such functions are
C(x) = cost of producing x units of the product,
R(x) = revenue generated by selling x units of the product,
P(x) = R(x) − C(x) = the profit (or loss) generated by producing and (selling x units of the
product.)

EXAMPLE 1: An apartment complex has 250 apartments to rent. If they rent x apartments then their
monthly profit, in dollars, is given by,

How many apartments should they rent in order to maximize their profit?

SOLUTION:
1. Find derivative and the critical point(s) that fall in the range .

Since the profit function is continuous and we have an interval with finite bounds we can find
the maximum value by simply plugging in the only critical point that we have (which nicely enough in
the range of acceptable answers) and the end points of the range.

Thus, they will generate the most profit if they only rent out 200 of the apartments instead of all
250 of them.

EXAMPLE 2: A production facility is capable of producing 60,000 widgets in a day and the total daily
cost of producing x widgets in a day is given by,

How many widgets per day should they produce in order to minimize production costs?

SOLUTION:
1. Minimize the cost subject to the constraint that x must be in the range
Get the first couple of derivatives of the cost function

The critical points of the cost function are

Clearly the negative value doesn’t make any sense in this setting and so we have a single
critical point in the range of possible solutions: 50,000
 Thus, as long as the second derivative is positive and so, in the range of possible
solutions the function is always concave up and so producing 50,000 widgets will yield the
absolute minimum production cost.

EXAMPLE 3: The production costs per week for producing x widgets is given by,

Answer each of the following questions.

(a) What is the cost to produce the 301st widget?
(b) What is the rate of change of the cost at ?

SOLUTION:

(a) We can’t just compute as that is the cost of producing 301 widgets while we are looking
for the actual cost of producing the 301st widget. In other words, what we’re looking for here is,

So, the cost of producing the 301st widget is $295.91.

(b) In this part all we need to do is get the derivative and then compute .

EXAMPLE 4: The production costs per day for some widget is given by,

What is the marginal cost when , and ?

SOLUTION:
Find the derivative and then we’ll need to compute some values of the derivative.

Thus, in order to produce the 201st widget it will cost approximately $10. To produce the
301stwidget will cost around $38. Finally, to product the 401st widget it will cost approximately
$78.

EXAMPLE 5: The weekly cost to produce x widgets is given by

and the demand function for the widgets is given by,

Determine the marginal cost, marginal revenue and marginal profit when 2500 widgets are
sold and when 7500 widgets are sold. Assume that the company sells exactly what they produce.

SOLUTION: Get all the various functions needed.

 Revenue and profit functions.

Marginal functions,

The marginal functions when 2500 widgets are sold are,

The marginal functions when 7500 are sold are

So, upon producing and selling the 2501st widget it will cost the company approximately $25 to
produce the widget and they will see an added $175 in revenue and $150 in profit.

On the other hand when they produce and sell the 7501st widget it will cost an additional $325 and
they will receive an extra $125 in revenue, but lose $200 in profit.

EXAMPLE 6: A company can produce a maximum of 1500 widgets in a year. If they sell x widgets
during the year then their profit, in dollars, is given by,

SOLUTION: Determine the absolute maximum of the profit function and the value of x that will give
the absolute maximum.

Evaluate the profit function at the critical points from the second step and at the end points of the
given interval. Here are those function evaluations.

They will need to sell 1200 widgets to maximize the profits.

EXAMPLE 8: A management company is going to build a new apartment complex. They know that if

the complex contains x apartments the maintenance costs for the building, landscaping etc.
will be,

The land they have purchased can hold a complex of at most 500 apartments. How many
apartments should the complex have in order to minimize the maintenance costs?
 SOLUTION: Determine the absolute minimum of the maintenance function and the value
of x that will give the absolute minimum

Derivative of the maintenance function and the critical point(s)

Evaluate the maintenance function at the critical points from the second step and at the end
points of the given interval. Here are those function evaluations.

The complex should have 500 apartments to minimize the maintenance costs.

EXAMPLE 9: The production costs, in dollars, per day of producing x widgets is given by,

What is the marginal cost when and ? What do your answers tell you about the
production costs?

SOLUTION: Marginal cost is simply the derivative of the cost function

The marginal costs for each value of x is then,

From these computations we can see that this will cost approximately $19.56 to produce the
176th widget and approximately $63 to produce the 301st widget.

EXAMPLE 10: The production costs, in dollars, per month of producing x widgets is given by,

What is the marginal cost when and ? What do your answers tell you about the
production costs?

SOLUTION: Marginal cost is simply the derivative of the cost function

It will cost approximately 25 cents to produce the 201st widget and approximately 46 cents to
produce the 501st widget.
III. NEWTON’S METHOD

EXAMPLE 1: Use Newton’s Method to determine an approximation to the solution to that lies
in the interval [0,2]. Find the approximation to six decimal places.

SOLUTION: As noted in the general rule of thumb in these cases is to take the initial approximation
to be the midpoint of the interval. So, we’ll use as our initial guess.
Rewrite the equation as
Simplify with Newton’s Method

Going farther,

We will assume that the solution is approximately .

EXAMPLE 2: Use to find the approximation to the solution to .

SOLUTION: Clearly the solution is

 These computations get farther and farther away from the solution, , with each
iteration. Here are a couple of computations to make the point.

So, in this case the method fails and fails spectacularly.

EXAMPLE 3 & 4 : Use Newton’s Method to determine for the given function and given value of .

3. if

Solution:

First derivative

The first iteration through the formula for is,

The second iteration through the formula for is,

So, the answer for this problem is .

4. if
Solution:

First Derivative

The first iteration through the formula for is,

The second iteration through the formula for is

 So, the answer for this problem is .

EXAMPLE 5. Use Newton’s Method to find all the roots of the given equation accurate to six decimal
places.

Newton’s Method solves equation in the form

For the left most root, start with . Here are the results of iterating through
Newton’s Method for this root.

Estimate of the left most root is : .

For the right most root let’s start with . Here are the results of iterating through
Newton’s Method for this root.

Estimate of the right most root is :

EXAMPLE 6:

SOLUTION:
IV. MEAN VALUE THEOREM

EXAMPLE 1: Determine all the number(s) c which satisfy the conclusion of Rolle’s Theorem for

on .

SOLUTION:

Take the derivative,

And then solve .

A single value and it is in the interval,

EXAMPLE 2 : Determine all the number(s) c which satisfy the conclusion of Rolle’s Theorem
for

on .

SOLUTION: Take the derivative,

and then solve .

So, we found two values and, in this case, are both in the interval,
EXAMPLE 3: Determine all the number(s) c which satisfy the conclusion of Mean Value Theorem for

on .

SOLUTION: do some function evaluations and take the derivative.

Plug into the formula from the Mean Value Theorem and solve for c.

So, we found two values and, in this case, only the second is in the interval,

EXAMPLE 4: Determine all the number(s) c which satisfy the conclusion of Mean Value Theorem
for

on .

SOLUTION: do some function evaluations and take the derivative.

Plug into the formula from the Mean Value Theorem and solve for c.

Answer:

EXAMPLE 5: Suppose we know that is continuous and differentiable on the interval

, that and that . What is the largest possible value for ?

SOLUTION:

Plug in the known values.

Solve for
 Plugging the maximum possible value of the derivative into above will,

So, the largest possible value for is 11. Or, written as an inequality this would be written
as,