CHAPTER 7

7.0 Business Mathematics Techniques

7.1 Explanation of Usefulness of Computer Packages and Relations with

Business Decision Making

Computer packages such as computer Stat, MINITAB, Microsoft Excel or other

statistical software packages, or a graphing calculator such as the TI-83 have
made life easy to solve problems or complete projects for students. Computers
are able to perform millions of calculations with speed and accuracy, often
summarizing the solutions in interesting, colourful charts and tables.

Students who have studied computer languages can write their own programs to
solve many of the exercises in this book or they may prefer to use one or more
available software packages which provide ready made programs as mentioned
above. In either case the student benefits from an interesting and useful
experience.

It may be noted, however, that the use of the computer is not essential to the
reader. Almost all the exercises on this manual can be solved with pencil and
paper, but the use of an inexpensive hand-held calculator will reduce the amount
of labour involved in many calculations. Some exercises are provided in which
the use of a computer is recommended, and these are clearly marked.

7.2 Matrix Algebra

This section introduces matrices as structures in which data can be stored and
manipulated. The rules for adding and multiplying matrices are given. Also the
manipulation of simultaneous equations using matrix algebra is explained through
examples.

7.2.1 Matrices: Definition

Matrices are rectangular arrays of numbers or symbols. The dimension of

a matrix is stated as the number of rows by number of columns. The
following are examples of matrices with their dimensions:

3 1 
3 −1   
A =   B =  2 0 C = (3 14 )
 2 2 1 1 
 
Dimension 2 × 2 3× 2 1× 3

302
A business might have the number of employees in each of its departments
classified as to their sex for example.

Male Female
Accounts 16 5
Ledgers 10 3
Purchasing 5 8

The actual matrix is a framework, which holds the data values; the
sections Accounts, ledgers, purchasing, male and female in our example
are there simply to identify precisely what the data is. Thus, if we call the
whole matrix set A, for convenience, we have:

16 5 
 
A = 10 3 
5 8 
 
Dimension : 3 × 2

Where it is understood that the first row is Accounts, the second row refers
to Ledgers and third row refers to purchasing. Similarly, the first column
is the number of male employees, the second female employees.

It is important to keep each element in its correct position in the matrix.

The null matrix is a matrix of any dimension in which every element is
zero, such as:

 0
 0 0  
 ,  0 , (0 0 0 0 )
 0 0  0
 

Dimension 2 × 2 3 ×1 1× 4

The unit matrix or identity matrix is any square matrix in which every
element is zero except the elements on the main diagonal, each of which
has the value 1, such as:

1 0 0 
1 0   
I =  , I =  0 1 0
 0 1 0 0 1 
 

303
 The unit or identity matrix is represented by the symbol I.

Matrices are equal if they are of the same dimension and the
corresponding elements are identical:

2 1
2 − 3 2 − 3  2 3 3  
 ,   are equal but the matrices ,  3 2  are not equal.
1 5  1 5 1 2 2   3 2
 
The elements are identical but the dimensions are not.

The transpose of a matrix is the matrix obtained by writing the rows of any
matrix as columns or vice versa as follows:

T
row 1  1 3   1 2 
  = 
row 2  2 4   3 4 

where the superscript T indicates that the matrix is to be transposed.

7.2.2 Definition of Matrix Addition and Subtraction

To add matrices, add the corresponding elements, for example,

 1 3  1 0   1 + 1 3 + 0   2 3 
  +   =   =  
 2 0  1 2   2 + 1 0 + 2   3 2 

To subtract matrices, subtract the corresponding elements, for example,

 1 3  1 0   1 − 1 3 − 0   0 3 
  −   =   =  
 2 0  1 2   2 − 1 0 − 2   1 − 2 

In general, two matrices can be ADDED (or one matrix, subtracted from another)
only if they have identical sizes. That is, the number of rows in each of the two
matrices must be the same and the number of columns in the two matrices must
be the same.

304
Example 1

Given the following matrices

3 0 3 8  1 2 4 
A =  , B =  , C =  
 1 2   4 10   1 3 6 

a) Calculate

i) A+B

ii) A-B

b) Why is it not possible to calculate B + C or B – C? Hence, state the

restrictions on matrix addition and subtraction.

3 0  3 8  3 + 3 0 + 8   6 8 
a) i)   +   =   =  
 1 2   4 10   1 + 4 2 + 10   5 12 

 3 0   3 8   3 − 3 0 − 8   0 − 8
ii)   −   =   =  
 1 2   4 10   1 − 4 2 − 10   − 3 − 8 

b) When attempting to add the corresponding elements of the

matrices B and C, it is found that there is no third column in matrix
A, therefore it is not possible to add pairs of corresponding
elements in the two matrices. Matrix addition is not possible.

 3 0  1 2 4   3 + 1 0 + 2 ?+ 4 
  +   =  
 1 2  1 3 6   1 + 1 2 + 3 ?+ 6 

No corresponding element to add.

The same problem arises when attempting to subtract matrices B and C:

there is no third column in matrix B from which to subtract the elements in
column three of matrix C.

305
7.2.3 Multiplying a Matrix by a Number

An ordinary number: 1, 2, -3, 4, etc., is called a Scalar hence matrix

multiplication by a number is sometimes called Scalar multiplication. And when
scalar multiplication is performed, each element in the matrix is multiplied by the
scalar:

Example 2

a) Given the matrix

 3 1
B =   calculate 3B.
 2 5

b) Calculate 2I, where I is the 2 x 2 unit matrix.

 3 1  9 3 
a) 3B = 3  =  
 2 5   6 15 

 1 0  2 0
b) 2 I = 2  =  
 0 1  0 2

7.2.4 Matrix Multiplication

Matrix multiplication AB is possible if the number of elements in the rows of the

first matrix (A) is the same as the number of elements in the columns of the
second matrix (A). This condition for matrix multiplication can be established
quickly by writing down the dimensions of the matrices to be multiplied, in order

A × B = product Dimension of
product 2 × 4

Dimensions: (2 × 3) × (3 × 4) = (2 × 4 )

The same, so multiplication is possible

The ‘inside’ numbers are the same, therefore multiplication is possible. The
‘outside’ numbers give us the dimension of the product.

306
Example 3

Given the matrices

 2 1 1 0   3 1 1
A =  , B =  , C =  
 3 5   1 1   0 1 2 

Calculate: (a) AC (b) CA (c) AB (d) BA

Compare your answers for (a) and (b)

 2 1  3 1 1
a) AC =    
 3 5  0 1 2

Dimension: 2 × 2 × 2 × 3 = 2 × 3

Same, multiplication possible

 2(3) + 1(0 ) 2(1) + 1(1) 2(1) + 1(2 ) 

=  
 3(3) + 5(0 ) 3(1) + 5(1) 3(1) + 5(2 )

6 + 0 2 +1 2 + 2  6 3 4 
=   =  
 9 + 0 3 + 5 3 + 10   9 8 13 

 3 1 1  2 1
b) CA =    
 0 1 2  3 5

2 × 3 × 2 × 2

Not same, multiplication not possible

 2 1  1 0 
c) AB =    
 3 5  1 1 

2 × 2 × 2 × 2 = 2 × 2

Same multiplication possible

 2(1) + 1(1) 2(0 ) + 1(1)   2 + 1 0 + 1   3 1 

AB =   =   =  
 3(1) + 5(1) 3(0 ) + 5(1)  3 + 5 0 + 5   8 5 

307
 1 0   2 1 
d) BA =    
1 1   3 5 

2 ×2 2 × 2

Same, multiplication possible

1(2 ) + 0(3) 1(1) + 0(5)  2 1

BA =   =  
 1(2 ) + 1(3) 1(1) + 1(5)   5 6

 3 1  2 1
In the above example, AB =   and BA =   therefore
 8 5  5 6
AB ≠ BA. (Since two matrices are equal only if all corresponding elements
are identical). So in matrix multiplication, the order of multiplication is
important. In general, in matrix multiplication AB ≠ BA. .

7.2.5 Find the Inverse

Solving Ax = b when A is a square matrix. The dimension of the matrix x is an

r × 1 . If this was the equation ax = b, where a, x and b are numbers, and not
b
matrices, we could solve for x by dividing both sides by a to give x = . We
a
can’t do the same thing (divide by A) to solve AX = b because we have not
defined a way of dividing by a matrix.

Since A is a square matrix, it has an inverse called A−1 such that

A ⋅ A−1 = A−1 A = I where I is the identity matrix.

Several methods exists for finding A−1 given A. Here two methods will be given
through examples.

308
Example 4
 1 2
Find the inverse of A =  
 2 3

Using the following elementary row operations:

1. The interchange of any two rows of a matrix.

2. The replacement of any row of a matrix by a non-zero constant multiple of

itself.

3. The replacement of any row of a matrix by the sum of itself and a constant
multiple of some other row.

Which will lead to an equivalent matrix.

1 2 1 0
 
2 3 0 1 

original identity matrix

matrix

Step 1

The main idea is to create an identity matrix in the original matrix. The
matrix obtained in the position of the Identity Matrix is the inverse of the
original matrix.

Multiply row 1 by –2 and add the resulting row to row 2 to get the new
row 2.

-2 -4 -2 0
2 3 0 1
0 -1 -2 1

1 2 1 0
 
0 −1 − 2 1 

309
 Step 2

Multiply row by –1 to get the new row 2.

1 2 1 0
 
0 1 2 − 1

Step 3

We make the entry ' a12 ' zero by multiplying row by –2 and adding this
resulting row 2 to get the new row 1.

1 2 1 0
0 -2 -4 2
1 0 -3 2

1 0 −3 2
 
0 1 2 − 1

We have managed to get the identity matrix in the original position.

Hence

−3 2 
A−1 =  
 2 − 1

AA−1 = I
Check:  1 2  − 3 2   − 3 + 4 2 − 2  1 0
    =   =  
 2 3   2 − 1  − 6 + 6 4 − 3   0 1 

Method 2

An alternative method of finding and inverse was determinants. A determinant of

matrix A is denoted by A or Det A and is defined as follows: (for a 2 × 2
matrix)

310
 a b
If A =   then A = ad − bc
c d

1  d − b
and A−1 =  
ad − ac  − c a 

 1 2
Applying this method to our matrix A =  
 2 3
A = 1(3) − 2(2 ) = 3 − 4 = −1
1  3 − 2  − 3 2 
∴ A−1 =  = 
− 1  − 2 1   2 − 1

which is the same result as obtained by using the elementary row operations.

7.2.6 Solving Simultaneous Equations by Matrix Algebra

Matrix algebra can be useful for solving simultaneous equations.

Example 5

Solve, using matrix algebra, the following simultaneous equations.

3 x + 2 y = 22
a)
x + 3 y = 19

P = 22 − 2q
b)
P = 11 + 3q

a) Write the system as:

 3 2   x   22 
    =  
 1 3   y   19 

311
Method 1

Using elementary row operations, we have

3 2 22 
 
1 3 19 

matrix of matrix of constants

coefficients

Step 1

Interchange row 1 and row 2 to get

1 3 19 
 
3 2 22 

Step 2

The new row 2 is obtained by multiplying row 1 by –3 and adding the resulting row to
( )
row 2. r2 → −3r1 + r2 where 1 stands for new row 2.

1 3 19 
 
0 − 7 − 35 

Step 3

1
Divide row 2 by –7 (i.e., r2 → − r2 ) to get
2

1 3 19 
 
0 1 5 

312
Step 4

To get the new row 1, multiply row 2 by –3 and adding this resulting row to row 1
( )
r2 → −2r2 + r1 to get

1 0 4
 
0 1 5 

Therefore, x = 4, y = 5.

3(4 ) + 2(5) = 12 + 10 = 22
Check:
4 + 3(5) = 4 + 15 = 19

Method 2

 3 2  x  22 
A =  , X =  , b =  
1 3  y  19 
1  3 − 2
A = 9 − 2 = 7, A−1 =  
7  − 1 3 

Then X = A−1b
 x  1  3 − 2   22 
  =    
 y  7  − 1 3   19 
 x  1  66 − 38  1  28 
  =   =  
 y  7  − 22 + 57  7  35 
 x   4
  =  .
 y   5

313
b) Rewrite the given equations in the form.

p + 2q = 22
p − 3q = −13

1 2 22 
 
1 − 3 − 13 


Step 1
1 2 22 
r2 → − r1 + r2  
 0 − 5 − 35 

Step 2
1 1 2 22 
r2 → − r2  
5 0 1 7 


Step 3
1 0 8
r1 → −2r2 + r1  
0 1 7 

∴ P = 8 and q = 7

Method 2
1 2   p  22 
A =  , X =   and b =  
1 − 3  q  − 13 
Then A = −3 − 2 = −5
1  − 3 − 2
A−1 =  
−5  −1 1 

Therefore X = A−1b
1  − 3 − 2   22 
= −   
5  − 1 1   − 13 
1  − 66 + 26  1  − 40 
= −   = −  
5  − 22 − 13  5  − 35 
 8
=  ,
 7

∴ p = 8 and q = 7.

314
Example 5

A distributor records the weekly sales of television sets in three retail outlets in different
parts of the country (See Table 7.1).

Table 7.1 Number of Television Sets Sold in Each Shop

Sharp Sony Phillips

Shop X 50 300 150
Shop Y 85 425 213
Shop Z 90 30 28

The cost price of each model is:

Sharp K900,000, Sony K1.0 million, Phillips K1.2 million.

The retail price of each model in each of the three shops is given in Table 7.2.

Table 7.2 Selling Price of Television Sets in Each Shop

Sharp Sony Phillips

(000’000) (000’000) (000’000)
Shop X 1.2 1.85 2.10
Shop Y 1.5 1.80 1.85
Shop Z 1.1 1.95 2.00

Use matrix multiplication to calculate:

a) The total weekly cost of television sets to each shop.

b) The total weekly revenue for each model for each shop.
c) The total weekly profit for each shop.

a) The numbers sold from Table 7.1 may be written as a matrix, Q:

Television Sets Sharp Sony Phillips

Shop X  50 300 150 
 
Q = Shop Y  85 425 213 
Shop Z  90 30 28 


315
Write the cost of each type of television set as a column matrix:

 0.9  Sharp
 
C =  1.0  Sony
 1.2  Phillips
 

Total cost of television sets to each shop:

Q ⋅ C = Total Cost

Dimension 3×3 3×1 =3 × 1

 50 300 150   0.9   50(09 ) + 300(10 ) + 150(1.2 )   525 

      
 85 425 213   1.0  =  85(0.9 ) + 425(1.0 ) + 213(1.2 ) =  757.1
 90 30 28   1.2   90(0.9 ) + 30(1.0 ) + 28(1.2 )  144.6 
      

Cost to Shop X = K525 million, Shop Y = K757.1 million, Shop Z = K144.6

million.

b) The total revenue = price × quantity. The quantities are given by the matrix Q,
for the data in Table 7.1. The prices are obtained from the data in Table 7.2.
Matrix multiplication is carried out by multiplying rows by columns. Therefore
to multiply quantity × price for each television set, we get the transpose matrix of
the data in Table 7.2 that’s:

 1.2 1.5 1.1  − price of Sharp

 
P =  1.85 1.80 1.95  − price of Sony
T

 2.10 1.85 2.00  − price of Phillips

 

The required total required is obtained by multiplying.

316
 Sharp Sony Phillips
Shop X  50 300 150 
 
Q × P = Shop Y  85 425 213
T

Shop Z  90 30 28 

price of sharp  1.2 1.5 1.1 

 
X price of sony  1.85 1.80 1.95 
price of phillips  2.10 1.85 2.00 

 50(1.2 ) + 300(1.85) + 150(2.10 ) X 

 
= X 85(1.5) + 425(1.80 ) + 213(1.85) X 
X
 X 90(1.1) + 30(1.95) + 28(2.00 )

The off diagonal entries marked X don’t apply. Total revenue for shops X, Y and
Z are summarized as follows: TR;

 60 + 555 + 315 
 
= 127.5 + 765 + 394.05 
 99 + 58.5 + 56 
 

 930 
 
= 1286.55 
 213.5 
 

c) Profit = TR − TC

 930   525 
   
= 1286.55  −  757.1
 213.5  144.6 
   

 405 
 
=  529.45 
 68.9 
 

317
Example 6

A manufacturer produces two products A and B. For each unit of A sold the profit is
K50,000, and for each unit of B sold the profit is K68,750. From past experience it has
been found that 12.5% more of A can be sold than of B. Next year the manufacturer
desires a total profit of K262.5 million. How many units of each product must be sold?

Let x be the number of units of A to be sold and y the number of units of B to be sold.
Then x = 1.125 y and 50 000 x + 68 750 y = 262 500 000.

We solve the two equations

x − 1.125 y = 0 (1)
50 000 x + 68 750 y = 262 500 000 (2)

 1 − 1.125 0 
 
 50 000 68 750 262 500 000 

 1 − 1.125 0 
r2 → −50 000 r1 + r2  
 0 125 000 262 500 000 
1  1 − 1.125 0 
r2 → r2  
125 000  0 1 2100 
1 0 2362.5 
r1 → 1.125 r2 + r1  
0 1 2100 

Thus x = 2362.50 and y = 2100, so approximately 2362.50 units of A and 2100 units of
B must be sold.

Exercise 1

 2 5 4  3 2 3
   
1) Taking A =  3 2 9  B =  1 5 9
 2 2 3  7 2 5
   

Calculate: (a) A + B (b) A – B (c) AB

318
  1 4 3
−1
 
2) Find A when A =  0 1 1 
 7 4 0
 

3) a) State the general rule for two matrices X and Y to be multiplied.

 2 1 1  4 0
     1 1 3  4 5
b) A =  3 0 2 , B =  5 1 , C =  , D =  
 5 2 0  4 0  2 5 5  0 4
   

Which of the following matrix multiplication are possible?

AB AC AD BA BB CD CB CA CD DC

Indicate the dimension of the product matrix where possible.

2 5   3 0 4
4) Given A =   and B =  
 3 − 2 5 − 3 5

Find: a) AB and b) BA.

 3 1 − 2
5) Given A = (5 2 ) and B =  
2 5 0 

Find: a) AB b) BA.

6) Compute the following if possible:

 2 3 − 2  4 0 3
a)   +  
 1 5 5   5 − 2 − 1

 2 − 1 4  1 0 − 5 
b)   −  
 0 5 6  1 3 1 

 5 − 3  0 1 2
c)   +  
 2 4   2 3 4 

 1 − 3 2 5  3 6 1 − 2 
d)   +  
 4 1 1 1  4 2 − 3 − 3

319
7) Let (r × c ) denote a matrix with shape r × c, i.e, r denotes the number of rows
and c the number of columns.

a) What is the dimension of the product of two matrices (r × c ) × (w × x ).

b) Find the dimensions of the product of the matrices with the following
dimensions.

i) (5 × 4) (4 × 6)
ii) (3 × 1) (1 × 5)
iii) (5 × 2 ) (5 × 3)
iv) (6 × 3) (7 × 3)
v) (5 ×) (5 × 1)
vi) (6 × 5) (5 × 5)

8) a) Solve the following equations for x and y using matrix algebra.

45 x + 25 y = 115
16 x + 30 y = 62

0 7  1 5
b) If A =   and B =  
 5 2  6 6

Find (i) AB and (ii) BA.

320
9) A fast food chain has three shops, X, Y and Z. The average daily sales and profit
in each shop is given in the following table.

Units Sold Units Profit (Kwacha)

Shop X Shop Y Shop Z Shop X Shop Y Shop Z
Chips 900 500 600 3500 3000 2500
Chicken 750 400 500 1500 2000 3500
Beef 400 1100 800 2000 2500 1500

Use matrix multiplication to determine.

a) The profit for each product.

b) The profit for each shop.

10) The percentage of voters who will vote for party candidates P, Q and R is given in
the following table:

P Q R Number of Votes
Area X 35% 15% 50% 110 000
Area Y 65% 25% 10% 80 000
Area Z 45% 36% 19% 75 000

Use matrix multiplication to calculate the total number of votes for each
candidates.

321
 EXAMINATION QUESTIONS WITH ANSWERS

Multiple Choice Questions

Answer all sub-questions

1.1 The inverse of the following matrix

8 2
5 2 is given by
 

4 1  1 − 1
3 3  3 3  2 − 2
A. 5 1
B. − 5 4
C. − 5 8 
     
6 3  6 3

8 2
6 6
D. 5 2
 
6 6

(Natech, 1.2 Mathematics and Statistics, Nov/Dec 2000)

1 2 3   1 − 2 − 4
1.2 If X = 2 4 6 and Y = − 1 − 2 − 4
 
3 6 9  1 2 4 

What is XY?

0 0 0  1 0 0  − 1 − 2 − 3
A. 0 0 0  B. 0 1 0  C. − 2 − 4 − 6
     
0 0 0 0 0 1   − 3 − 6 − 9 

0 0 − 1
D. 1 2 2 
 
2 8 12 

(Natech, 1.2 Mathematics and Statistics, June 2003).

322
1.3 Find the product AB of the following set of matrices:

2 2
1 2
A = 1 4 B= 
3 5  0 2 

4 8  2 8 
5 10 1 10 6 10 9 
A.   B.   C. 4 8 10
8 6  3 16  

6 4
D. 10 8 
 
 9 16
(Natech, 1.2 Mathematics and Statistics, June 2002)

 1 − 3
1.4 Find the inverse matrix, A−1 , of matrix A given as follows:  
2 4 

 −1 2   2 5 3 10   − 3 1
A.   B.   C.  
 − 3 − 4  − 1 5 1 10   4 2

 1 0
D.  
 0 1

 3 − 2 6 5 
1.5 If A =   B =   and C = 4 B − 3 A, then
5 −1 12 − 2 

A. C12 = 15 B. C11 + C12 + C21 +C22 = 74

C.. C12 + 3 = 0 D. C11 +C12 = 33

323
  8 1
1.6 The Inverse of the matrix A if A =   is
 2 0

 −1  1
 0 − 1 0  4 
A.   B. C.
 2   2
− 2 8   1 − 4 1 0

 −1
D. 0 
 2 
−1 4 

 1 3  1 2 3
1.7 If A =  , B =  , A+ B is
 4 5   0 1 2 

 2 5  0 1  2 6
A.   B.   C.  
 4 6  4 4  4 7

D. None of these.

 1 5 1 1 
1.8 Find the product of BA of the following matrices A =   , B =  
 2 0 1 2 

 6 11 1 1   2 6
A.   B.   C.  
2 2  1 2   3 2

D. None of these.

2 1 1 
 
1.9 If A =  4 3 2 , find A
 2 − 1 − 3
 

A. −8 B −8 C. −40 D. 8

324
 3 1
1.10 Evaluate the determinant .
2 5

 5 − 1
A. 17 B. 13 C.   D. None of these.
− 2 3 

SECTION B

ATTEMPT ANY FIVE QUESTIONS IN THIS SECTION.

QUESTION ONE

a) Using the matrices P and Q below

 4 2 − 3 1 
P =   ; Q =  
 − 2 1  3 − 4

Solve the following equations:

i) X +P=Q

ii) Y + Q = 4P

b) A square matrix A is the inverse of the square matrix B if and only if

AB = I = BA where I is the identity (or unit matrix). In each of the following
show that matrix A is the inverse of matrix B.

 7 3  1 − 3
i) A =   ; B =  
 2 1 − 2 7 

 0 .2 − 0 .2   2 1 
ii) A =   ; B =  
 0 .6 0 .4   − 3 0 .4 

 3 7  5 − 7
iii) A =   ; B =  
 2 5   − 2 35 

(Natech, 1.2 Mathematics and Statistics, June 1997).

325
QUESTION TWO

a) Zam Protect Insurance Company has four salesmen working in the Midlands area.
The number of policies they sold during the last month is given in matrix A, as
follows:

Mumba Daka Besa Moonga

 8 7 6 8  Vehicle
 
 6 9 11 5  Life
A= 
4 3 2 0 Fire / Riot
 
 0 
 2 1 3  Household

If S = (1 1 1 1) , find the product SA and interpret its elements.

1 2  4 2
b) Given that A =   and B =  
3 3  3 1

Find C, the product of the two matrices, A and B.

(Natech, 1.2 Mathematics and Statistics, December 1997)

QUESTION THREE

 1 1 6
  0 1 3  
a) A =  3 , B =  , C = 3 0
 5  − 2 1 0  − 2 2
   

Determine each of the following, if possible

i) A+C (ii ) BT +C (iii ) BA iv) AT B T v) BT AT

326
b) A fast food chain has 3 shops, X, Y and Z. The average daily sales and profit (in
thousands of kwacha) in each shop is given in the following table.

Sales
Shop X Shop Y Shop Z Unit Profit ‘000’
Chicken 1000 600 700 2 5 7
Chips 1150 800 900 3 6 9
Drinks 700 1400 1100 6 5 3

Use matrix multiplication to determine

i) the profit for each product

ii) the profit for each shop

QUESTION FOUR

a) Given for the following matrices

 2
1 5   2 − 1   1 3 4 
A =  , B =  , C =  6 , D =  .
 3 − 3   0 3  8  0 1 2 
 

i) Show, that AB ≠ BA

b) Determine the following if possible

i) AD ii ) AC iii ) DCC T iv) DC

327
c) The percentage of voters who will vote for party candidate A, B, and C is given in
the following table.

% votes for party candidates

A B C Number of Votes
Area X 35% 15% 50% 105 000
Area Y 65% 25% 10% 80 000
Area Z 28% 45% 27% 75 000

i) Use matrix multiplication to calculate the total number of votes for each
candidate.

ii) On polling day if the turnout is 65% in Area X, 35% in Area Y and 25% in
Area Z, use matrix multiplication to calculate the total votes for each
candidate.

QUESTION FIVE

a) Which of the following matrices do not have an inverse? Give reasons.

 1 0 1
1 5  3 2 1  
i) A =  , ii ) B =  , iii ) C =  2 1 0
3 2  0 1 5  1 3 2
 

b) Use the INVERSE MATRIX method to solve the following equations.

5Q1 + 2Q2 = 11
Q1 + 2Q2 + 4Q3 = 23
10Q1 + 4Q2 + 4Q3 = 36

328
QUESTION SIX

 2 3  5 − 1
a) If A =   and B =   , find
 1 2 6 1 

i) A ii ) B iii ) A+B iv) AB .

b) Use any matrix method to solve for P1 and P2 , given the following equations.

5 P1 + 9 P2 = 61
12 P1 + 2 P2 = 68.

QUESTION SEVEN

 3 3  9 4
a) A =  , B =  
 1 3  5 6

i) Find A + B

ii) A −B and B − A. Which general rule does this prove?

ii) Find AB and BA. Which general rule does this apply?

b) Solve the following equations for x and y using matrix algebra:

25 x + 50 y = 525
15 x + 25 y = 275

329
QUESTION EIGHT

a) The ABC’s polling organization asked a sample f voters for their preference for
mayor of the city of Kitwe in the coming election. The organization found the
following table:

MMD UPND Other Undecided

Candidate Candidate Candidates
MMD 550 100 60 8
UPND 200 450 80 3
Independents 50 100 15 100

i) Write the corresponding matrix.

ii) How many MMDs were interviewed?

iii) How many voters preferred the UPND candidate?

iv) How many independents were undecided?

3
 
 4 − 2 1
b) A =  , B = (2 0 1 − 2 ), C =  . Find
6 0  −1
 
4
 

1
i) AB, ii ) 6A iii ) A, iv) BC.
2

330
7.3 Basic Linear Programming

7.3.1 Introduction

In this section we find the optimal value of linear functions (cost, profit,
revenue, output, etc) subject to several constraints. Industrial production,
flow of resources, investments, nutrition, etc all involve complex
interrelationships, among numerous activities. A common feature of
many of these problems is to formulate a course of action that will
minimize or maximize some essential quantity.

7.3.2 Feasible Regions

Several business production constraints can be graphically demonstrated

using their separate respective inequalities to produce a feasible region of
operation.

In a linear programming problem, the function to be maximized or

minimized is called the objective function. Although there are usually
infinitely many solutions to the system of constraints (these are called
feasible solutions or feasible points), the aim is to find one such solution
that is an optimum solution (that is, one that gives the maximum or
minimum value of the objective function).

Example 1

A factory can produce two products, X and Y. The contribution that can
be obtained from the products are,

A contribution of K10 000 per unit B contributes K15 000 per unit and it
is required to maximize its contribution. The objective function for this
factory can be expressed as as

Maximize 10 000 x + 15 000 y

where x = number of units of X produced
y = number of units of Y produced

Note that X and Y produced are sometimes called decision variables.

A factory requires three types of processing. The length of time for

processing each unit is given in the table below.

331
 Product X Product Y Maximum process
(hr/unit) (hr/unit) capacity per day
(hrs)
Process I 12 12 840

Process II 3 6 300

Process III 8 4 480

10 000 15 000

The limitations or constraints are circumstances which always exist and these govern
the achievement of the objective. The constrains in any given problem must be clearly
identified, quantified, and expressed mathematically. The constraints as regard to
processes can be stated as follows:

Pr ocess I 12 x + 12 y ≤ 840

Pr ocess II 3 x + 6 y ≤ 300

Pr ocess III 8 x + 4 y ≤ 480

In addition, a general limitation applicable to all maximizing problems is that it is not

possible to make negative quantities of a product, i.e

x ≥ 0, y ≥ 0.

These non-negativity constraints exclude any possibility of negative production levels

which have no physical counterpart. Together they include the x -axis and the y -axis as
possible boundaries of the feasible area.

332
y

120

Process III constraint

8 x + 4 y ≤ 480
70

A(0, 50)
B Process II constraint
3 x + 6 y = 300
(140 80)
, (40, 30)
3 2

Feasible Process I constraint

Region 12 x + 12 y = 840

C
D 60 70 100 x

The optimum solution can be found by looking at the corner points and substituting these
values in the objective function.

Corner Point Objective value function

10 000 x + 15 000 y

A(0, 50) 10 000(0) + 15 000(50) = 750 000

 140 80   140   80  2600 000

B ,  10 000   + 15 000   = = 866 666.67
 3 3  3   3 3

C(60, 0) 10 000 (60) + 15 000(0) = 600 000

D(0, 0) 10 000(0) + 15 000(0) = 0

333
 140 80
The maximum contribution occurs at point B. Therefore units of X and units of
3 3
Y should be produced to realize a profit of K866 666.67.

We classify the constraints of a linear program as either binding or non binding.

A binding constraint must pass through the optimum solution point. If it does not, it is
non binding. In our example, only process II and III constraints are binding. When a
constraint is binding, we may regard it as a scare resource since it has been used
completely.

 140   80 
Pr ocess II 3  + 6  = 140 + 160 = 300
 3   3

 140   80  1120 320 1440

Pr ocess II 8  + 4  = + = = 480
 3   3 3 3 3

On the other hand, a nonbonding constraint represents an abundant resource. A

redundant constraint is one which can be deleted from the solution space without
affecting the solution space. In our example, process I constraint is a redundant
constraint.

Example 2

The linear programming problem is now

Maximize Z = 10 000 x + 15 000 y

2 x + 13 y ≤ 780
3 x + 6 y ≤ 300
s.t
8 x + 4 y ≤ 480
x ≥ 0, y ≥ 0.

334
 y

120

Process III

(0, 60)
Process I

 260 420 
B  , 
 11 11 
A(0, 50)

 390 60 
C  , 
 7 7 
feasible Process II
region

0 D(60, 0) (65, 0) (100,0) x

Point B is the point of intersection between Process I and process II is

 260 420 
 ,  12 x + 13 y = 780, 3 x + 6 y = 300 . Point C is the point of intersection between
 11 11 
 390 60 
process Iii and process I  ,  12 x + 13 y = 780, 8 x + 4 y = 480.
 7 7 

335
Corner Objective value function
10 000 x + 15 000 y

A(0,50) K 750 000.00

 260 60 
B ,  K 809 090.91
 11 7 

 390 60 
C ,  K 685 714.29
 7 7 

D(60, 0) K 600 000.00

260 420
The optimal solution is to produce units of X and units of Y and the maximum
11 11
profit is K809 090.91.

Constraint I and II are binding while constraint III is non binding as shown in the table
below.

Process I Process II Process III

260  260   260   260 

units of X 12   3  8 
11  11   11   11 

420  420   420   420 

units of Y 13  6  4 
11  11   11   11 

Hours used 780 300

Maximum hours available 780 300 480
2
Unused hours 0 0 138.18 or 138
11

2
Process I and Process II have used all their hours completely while Process III has 138
11
hours un used.

336
 Example 3

Maximize the objective function Z = 5 x + 2 y subject to the constraints.

2 x + y ≤ 8,
2 x + 3 y ≤ 12,
x ≥ 0,
y ≥ 0.

8
2x + y = 8
4
D

feasible
C
region
2 x + 3 y = 12
A B
x

Figure 7.1 A, B, C and D are corner points of Feasible Region.

In Figure 7.1 the feasible region is non-empty and bounded. We have shaded the
unwanted region. Thus Z is a maximum at one of the four corner points. It can be shown
that:

A linear function defined on a non-empty bounded feasible region has a maximum

(minimum) value, and this value can be found at a corner point.

The coordinates of A, B D are obvious on inspection. To find C we solve the equations

2 x + y = 8 and 2 x + 3 y = 12 simultaneously, which gives x = 3, y = 2. Thus,
A = (0,0), B = (4,0), C = (3,2), D = (0,4).

337
Evaluating Z at these points, we obtain

Z ( A) = 5(0 ) + 2(0 ) = 0

Z (B ) = 5(4 ) + 2(0 ) = 20

Z (C ) = 5(3) + 2(2 ) = 19

Z (D ) = 5(0 ) + 2(4 ) = 8

Hence the maximum value of Z, subject to the constraints, is 12 and it occurs when
x = 4 and y = 0 .

Example 5

Minimize Z = 20 x + 30 y
Subject to
2 x + y ≤ 10,
3 x + 4 y ≤ 24,
8 x + 7 y ≥ 56,
x , y ≥ 0.
y

10

8 2 x + y = 10

8 x + 7 y = 56
6

•A
3 x + 4 y = 24

C x
5 6 8

Figure 7.2: The feasible region is empty.

338
As can be seen above, the feasible region is empty, so there is no optimum solution.

Example 6

Minimize C = 5 x + y

Subject to

3 x + y ≥ 3,
4 x + 3 y ≥ 6,
x + 2 y ≥ 2,
x , y ≥ 0.

3 •

2 feasible region

•B

• C
D
3x + y = 3 •
0 1 1.5 2 x

4x + 3y = 6 x + 2y = 2

Figure 7.3 A, B, C and D are corner points of feasible region.

339
The coordinates of A, and D are obvious on inspection. To find B, we solve the
equations 3 x + y = 3 and 4 x + 3 y = 6 . Similarly to find C, we solve the equations
4 x + 3 y = 0 and x + 2 y = 2 . Thus,

3 6 6 2
A = (0,3), B =  , , C =  , , D = (2,0 )
5 5 5 5

Evaluating C at these points, we obtain

C ( A) = 5(0 ) + 3 = 3
 3 6
C (B ) = 5  + = 4.2
5 5
6 2
C (C ) = 5  + = 6.4
5 5
C (D ) = 5(2 ) + 0 = 10

Thus C has a minimum value of 3.0 when x = 0 and y = 3.

Example 7

A production line can be set up to produce either product A or product B. The following
table gives the breakdown for each product.

Product Labour Material Testing

(Hours) (Kg) (Hours)
A 2 4 6 1
=
60 10
B 1 8 8 2
=
2 60 15

In any one week only 60 hours of labour and 560 kgs of material is available. Due to cost
and availability of the test equipment, it must be used for at least 8 hours. Also because
of existing orders, at least 10 of product A must be produced. The profit from each unit
of A produced is K50 000 and from each unit of B is K70 000. Find the weekly
production that will maximize profit and what is this maximum profit.

340
Let x and y be the number of products of A and B produced in a week. Then maximize
P = 50 000 x + 70 000 y

1
S ⋅t 2x + y ≤ 60 labour
2
4 x + 8 y ≤ 560 materials
1 2
x+ y ≥8 Testing
10 15
x ≥ 10 sales

Since x and y are numbers of products of A and B, then

x≥0
y ≥ 0.

120 4 x + y = 120

x = 10

70
• A
•B x + 2 y = 140
feasible
60 •D region

• C

0 10 30 80 140 x

1 2
x+ y ≥8
10 15

341
The coordinates for A are given by the intersection of x + 2 y = 280 and x = 10.
the coordinates for D are given by the intersection of
1 2
x + y = 8 and x = 10. B is given by the intersection of
10 15
4 x + y = 120 and x + 2 y = 28 − while coordinates for C are found by the
1 2
intersection of x + y = 8 and 4 x + y = 120.
10 15

Thus,

 100 440   240 600 

A(10, 65), B , , C  , , D(10, 52.5)
 7 7   13 13 

A P = 50 000(10 ) + 70 000( ) = K 5,050,000.00

 100   440 
B P = 50 000  + 70 000  = K 5,114,285.71
 7   7 
 240   600 
C P = 50 000  + 70 000  = K 4,153,846.15
 13   13 
 105 
D P = 50 000(10 ) + 70 000  = K 4,175,000.00
 5 

100 440
The maximum number of units is x = and y = giving a maximum
7 7
profit of K5,114,285.71.

342
Exercise 2

1. Maximize z = 20 x + 24 yz

Subject to

x + y ≤ 60,
x − 2 y ≤ 0,
x , y ≥ 0.

2. Maximize P = 7 x + 5 y

Subject to

3 x + 2 y ≤ 220,
2 x + 3 y ≤ 210,
x , y ≥ 0.

3. Minimize C = 3 x + 2 y

Subject to

x + 2 y ≥ 80,
3 x + 2 y ≥ 150,
5 x + 2 y ≥ 100,
x, y ≥ 0.

4. Minimize C = 15 x + 7 y

Subject to

3 x + y ≥ 3,
4 x + 3 y ≥ 6,
4 y + x ≥ 4,
x , y ≥ 0.

343
5. A company extracts minerals from ore. The numbers of kilograms of minerals A
and B that can be extracted from each ton of ores I and II are given in the table
below together with the costs per ton of the ores. If the company must produce at
least 3500kg of A and 3000kg of B, how many kilograms of each ore should be
processed in order to minimize cost? What is the minimum cost?

Ore I Ore II
Mineral A 100kg 200kg
Mineral B 200kg 50kg
Cost per kg K200 000 K240 000

6. A firm manufactures two products A and B. Each product requires machine time
and finishing time as given in the table below. The number of hours of machine
time and finishing time available per day is 24 hours respectively. The unit profit
on A and B is K13 500 and K18 000 respectively. What is the maximum profit
per day that can be obtained?

Machine Finishing
Time Time
A 120 minutes 240 minutes
B 240 minutes 120 minutes

7. A farmer raises chickens and fowls on her farm. She wants to rise no more than
80 birds altogether. The number of chickens should not be less than 50. She
spends K10, 000 to raise a chicken and K12, 000 to raise a fowl. She has K1,
000,000 available for this purpose. Chickens sell for K15, 000 and fowls for K18,
000 each respectively.

a) How many of each kind should be raised for maximum profit.

b) What is the maximum profit?

8. A company operates two types of airplanes, the ZA106 and the ZA108. The
ZA106 is capable of carrying 18 passengers and 14 tons of cargo, whereas the
ZA108 is capable of carrying 25 passengers and 7 tons of cargo. The company is
contracted to carryat least 207 passengers and 84 tons of cargo each day. If the
cost per journey is K300 000 for a ZA106 and K400 000 for a ZA108, what
choice of airplane will minimize cost?

344
9. The XYZ company is planning production of two products: forks and spoons, for
a certain period of time. Each product requires three types of processing. The
length of time required for processing each unit is given in the following table:

Forks Spoons Maximum

(hr/unit) (hr/unit) Process
Capacity
(hr)
Process I 4 2 14
Process II 1 1 5
Process III 1 0 4
Profit per unit K10 000 K13 000

Given these circumstance, you are required to:

a) State the constraints of the model.

b) Determine the coordinates of the corner points of the feasible region.

c) Find the optimal strategy by evaluating the objective function at each

corner point.

10. A firm is comparing the cost of advertising in two medias, Newspaper and radio.
For every kwacha’s worth of advertising, the table below gives the number of
people, by income group, reached by these media. The firm wants to reach out at
least 32000 persons earning under K100, 000 000 and at least 9000 earning over
K100,000,00. Find the amounts that the firm should spend on newspaper and
radio advertising so as to reach these numbers of people at a minimum total
advertising cost. What is the minimum total advertising cost?

__________________________________________________
Under Over
K100 000 000 K100 000 000

Newspaper 200 50

Radio 160 180

__________________________________________________

345
 EXAMINATION QUESTIONS

SECTION B
QUESTION ONE

A company produces two qualities of maheu; these are, type A 940% sweet and in
standard bottles) which is intended for the home market, and type B (60% sweet and in
large bottles) which is for export. After maturing in vats, both types require two stages of
processing; blending and bottling. The process times for a standard batch of each type of
maheu are:

Process Time (Hours)

Blending Bottling
Type A 1½ 1
Type B 2 3

There are 2,400 hours available for each process but because of the steady but limited
demand for type A, the number of batches of that type must not exceed 1,200; apart from
this, all stocks produced can be sold. The contribution to profit and fixed overheads per
batch is K2,000 for type A and K3,000 for type B.

You are required to:

i) State the objective function; and

ii) State the constraining factors for this situation with a view to deciding which
processing mix will maximize the total contribution to profit.

(NB: No graphing required).

(Natech, 1.2 Mathematics and Statistics, December 2003)

QUESTION TWO

In a factory, two products Alpha and Omega are produced using four different materials.
The table below indicates the material requirement in kilograms per unit of each product.

Material Alpha Omega

Requirement
Aeto 6 kgs 4 kgs
Beto 5 kgs 3 kgs
Ce to 5 kgs 10 kgs
Deto 16 kgs 8 kgs

346
During a normal working month, there are 2400 kgs of Aeto, 1500 kgs of Beto and 2000
kgs of Ceto. Currently there is no restriction on the availability of Deto.

The products earn contribution per unit of K22, 500 and K30, 000 for Alpha and Omega
respectively.

Company’s policy is to earn maximum profit by maximizing contribution.

i) Determine the linear programme model using the above details.

ii) Graphically, estimate the optimum production mix and hence calculate the
maximum contribution earned.

iii) State the binding constraints and the redundant constraint(s).

(Natech, 1.2 Mathematics and Statistics, December 2004)

QUESTION THREE

For the following linear programming problem:

i) Graph the constraints;

ii) Find the coordinates of each corner point of the region of feasible solutions; and

iii) Determine the optimal strategy by evaluating the objective function at each corner
point.

Minimize Z = 3 x + 4 y

1.5 x + y ≥ 60
Subject to: 2 x + 3 y ≥ 150
x + 2 y ≥ 90

and x , y ≥ 0.

(Natech, 1.2 Mathematics and Statistics, June 2001)

347
QUESTION FOUR

Simba Lawn-Care Services contracts with homeowners and business firms for a package
of service including planting, fertilizing, weed control, and maintenance of grass lawns.
Mr. Zimba, owner of Simba Lawn-Care Services mixes his own lawn treatment formulae
to meet the special needs of the individual account. Currently, a treatment solution is
needed which contains at least 14 measures of chemical A, at least 5 measures of
chemical B, and at least 12 measures of chemical C. Two preparations containing these
chemicals are sold commercially. Each canister of solu-X contains 4 measures of
chemical A, 1 measure of chemical B, and 2 measures of chemical C. Each canister of
Phos-Pho-Gen contains 2 measures of chemical A, 1 measure of chemical B, and 3
measures of chemical C. Each canister of solu-X costs K4,000, while each canister of
Phos-Pho-Gen costs K3,000.

The total revenue Simba Lawn-Care Services receives from an account is fixed by
contract; thus the company would like to perform the required services at a minimum
cost. Mr. Zimba, therefore, needs to know how to combine the two products, Solu-X and
Phos-Pho-Gen, to obtain a lawn treatment containing the required quantities of each
chemical. The chemical requirement per container of each of the two products, solu-X
and Phos-Pho-Gen, are given in the following table:

CHEMICAL REQUIREMENTS AND AVAILABILITY

Minimum Amount
Chemicals Quantities of Chemical Per Required in Treatment
Required Container (Measures) (Measures)
Solu-X Phos-Pho-Gen
Chemical A 4 2 14
Chemical B 1 1 5
Chemical C 2 3 12
Cost of container K4 000 K3 000

Given these circumstances, you are required to:

i) State constraints of the model.

ii) Determine the co-ordinates of the corner points of the feasible region.

iii) Find the optimal strategy by evaluating the objective function at each corner
point.

(Natech, 1.2 Mathematics and Statistics, December 1998)

348
QUESTION FIVE

A small Copperbelt-based biscuit-making factory makes two brands of biscuits. To make

a batch of standard biscuits takes 20 kg of flour and 2 kg of butter, whereas a batch of
special biscuits requires 10 kg of flour and 5 kg of butter.

The firm makes a profit of K20,000 on a batch of standard biscuits and a profit of
K60,000 on a batch of special biscuits. The factory has at most 200 kg of flour and 40 kg
of butter available each day.

You are required to:

i) Formulate this as a linear programming problem.

ii) Determine by graphical means how many batches standard biscuits and special
biscuits the factory should produce each day in order to maximize profit.

(Natech, 1.2 Mathematics and Statistics, June 2003)

QUESTION SIX

Suppose that a company is planning production for a period of one week. It is making
two products, X and Y, each of which requires certain foundry, machinery, and finishing
capacity as shown in the following table:

Product Foundry Machining Finishing

X 6 hr/unit 3 hr/unit 4 hr/unit
Y 6 hr/unit 6 hr/unit 2 hr/unit

The following number of hours are available in each area during the week being planned.

Foundry 420 hours

Machining 300 hours
Finishing 240 hours

Given these circumstances, you are required to:

i) State and graph the constraints of the model.

ii) Determine the coordinates of the corner points of the feasible region.

iii) State the objective function and determine how many units of each product should
be produced in order to achieve maximum profit, given that each unit of product
X produces a profit of K3,000 and each unit of product Y produces a profit of
K2,000.

(Natech, 1.2 Mathematics and Statistics, December 2002)

349
7.4 INTRODUCTION TO DIFFERENTIAL CALCULUS

1. Introduction

This Chapter covers elementary calculus. The field of calculus is a large

and complex field of mathematics with applications in many different
fields. This manual concentrates only on simple differentiation and
integration which is likely to be relevant in accounting and business. The
rules for differentiation, its integration and its practical use in the finding
of the maximum and minimum values of functions or turning points on
curves are covered. Finally, the rules of integration are given.

Contrary to (often popular) belief, that calculus is a difficult area of study,

NO, it is not especially when one follows:

i) a few simple rules which will be given;

ii) an understanding of some relevant applications.

Differentiation could be used to find the maximum or minimum points of

the curves of certain business functions. For example, cost, revenue and
profit functions. The aim of any business is minimize cost and maximize
profit. If one is able to determine the production function of his or her
business, the level at which the maximum profit will occur can be
determined. Differentiation can also be used to find the “rate of change”
of cost or revenue functions. This rate of change is called marginal.
Hence the rate of change of the cost function is the marginal cost and that
of the revenue function is the marginal revenue etc.

Integration is the process of reversing differentiation. It can be used to

find revenue or cost function from the marginal revenue or marginal cost
function respectively.

1) Simple Functions

The most commonly used functions in business are the linear and
quadratic functions. For example a simple linear function for total
cost might have the form:

y = a + bx where y = total cost, the dependent variable. x =

output or activity, the independent variable and a and b are
constants, representing fixed cost and variable (or marginal) cost
respectively.

350
 Such a function is shown in Figure 1.0.

b = the slope of the line which

represents the marginal cost
Costs

a = fixed cost

activities x

Graph of a simple linear cost function.

Figure 1

2) Quadratic Functions

The other common function found in business and accounting is a quadratic

function. This is of the form y = ax 2 + bx + c where y = total cost or revenue
etc, the dependent variable, x = output activity, the independent variable, a , b
and c are constants. ‘ a , b ’will form part of the variable cost and c is the fixed
cost.

Rule and Notation For Differentiation

Differentiation can be thought of as a process, which transforms one function into

a different one. The new function is known as the derivative of the original one.

351
Derivative of a Simple Function

The simple function y = Kx n (where K and n are any numbers) can be differentiated to
give the new function:

dy
= Knx n −1
dx
dy dy
where is read as “the Derivative of y with respect to x”. is also denoted
dx dx
by y′ . In particular,

dy
a) y = Kx, then =K
dx

dy
b) If y = K , then =0
dx

Thus, for example,

dy
If y = 8x 4 , then = 8(4) x 4 −1 = 32 x 3 ;
dx

dy
If y = 5x, then = 5(1) x1−1 = 5;
dx

dy
If y = 20, then =0
dx

Example 1

Using the above rule find the following derivatives.

dy
a) If y = 25x 3 , then = 25(3) x 3−1 = 75 x 3
dx

dy
b) If y = −165x 7 , then = −165(7) x 7 −1 = −1155 x 6
dx

dy
c) If y = 9 x100 , then = 9(100) x100 −1 = 900 x 99
dx

352
Derivatives where the function is a sum and a difference

The Derivative of the sum of two (or more) simple functions is the sum of the separate
derivatives of the functions.

Example 2

dy
a) If y = 3 x 4 − 12 x 3 + x + 20, then = 12 x 3 − 36 x + 1 .
dx
7 1 dy
b) If y = 3 + − 3 x 2 + 5 = 7 x − 3 + x −1 − 3 x 2 + 5, then = 21x − 4 − x − 2 − 6 x .
x x dx

dy
c) If y = x 6 + 5 x 5 , then = 6 x 5 + 25 x 4 . .
dx

Derivatives where the function is a product.

dy
If y = ( x 2 + 5 x)( x + 2), find .
dx

Consider y as a product of two functions

y − ( x 2 + 5 x) ( x + 2)

first second

dy d d
then = ( first ) (sec ond ) + (sec ond + ( first )
dx dx dx

d d
= ( x 2 + 5 x) ( x + 2) + ( x + 2) ( x 2 + 5 x )
dx dx
first second

Derivative Derivative of first

Of second

= ( x 2 + 5 x)(1) + ( x + 2)(2 x + 5)
= x 2 + 14 x + 10

The derivative of the product of two functions is the first function times the derivative of
the second, plus the second function times the derivative of the first.

353
Example 3

dy
a) If y = (5 x 2 + 3)(6 x 4 + 7); then = (5 x 2 + 3)(24 x3 ) + (6 x 4 + 7)(10 x)
dx
= 180 x 5 + 72 x 3 + 70 x

1
dy 1 1 1

b) If y = (3 x 3 + 5)( x 2 + 7); then = (3x 3 + 2)( x 2 ) + ( x 2 + 5)(9 x 2 )

dx 2
3 72 1 5

= x + x 2 + 9 x 2 + 54 x 2
2

Derivates where the function is a quotient

x+5 dy
If y = , find
x+2 dx

Consider y as a quotient provided the denominator is not zero. Then:

d d
deno min ator − numerator deno min ator )
d dx dx
(quotient ) =
dx (deno min ator ) 2

d d
( x + 5) − ( x + 5) ( x + 2)
dy
= ( x + 2) dx dx
dx ( x + 2) 2

( x + 2)(1) − ( x + 5)(1)
=
( x + 2) 2
x+2− x−5 −3
= = .
( x + 2) 2
( x + 2) 2

That is, the derivative of the quotient of two functions is the denominator times the
derivative of the numerator, minus the numerator times the derivative of the denominator,
all divided by the square of the denominator.

354
Example 4

d d
( x − 2) ( x + 3) − ( x + 3) ( x − 2)
x + 3 dy dx dx
a) If y = ; =
x − 2 dx ( x − 2) 2

dy −5
= .
dx ( x − 2) 2

d d
(8 x 2 − 5) (3 x) − 3 x (8 x 2 − 5)
3x dy dx dx
b) If y = ; =
3 x − 5 dx
2
(8 x − 5)
2 2

dy − 15 − 24 x 2
= .
dx (8 x 2 − 5) 2

Derivatives Functions of A Function

Consider the function y = (2 x − 5) 4 where the expression in the brackets is a

differentiable function say u, i.e u = 2 x − 5 , the whole expression can be written as
y = U 4 . In such cases the rule for differentiation is

dy dy du
= × which is known as the chain rule. Thus to differentiate y = (2 x − 5) 4 . We
dx du dx
dy du
let u = 2 x − 5 then y = u 4 . And = 4u 3 and = 2.
du dx

dy dy
Therefore = 4u 3.2 = 8u 3 . But the original function is in x. Hence, = 8(2 x − 5)3 .
dx dx

355
Example 5

Using the Chain Rule

dy
a) If y = (2 − 5 x)3 find .
dx

dy dy du
= .
dx du dx

Let u = 2 − 5 x, then y = u 3
du dy
= −5 and = 3u 2
dx du

dy
Therefore = −5(3u ) = −15u 2 . We can write our answer in terms of x alone by
dx
replacing u by 2 − 5 x.

dy
= −15(2 − 5 x) 2 .
dx

dy 1

b) If y = 1 − 2 x, find . Here, we let u = 1 − 2 x, then y = u 2 . Then by chain rule

dx

dy dy du 1 1
= . = u 2 .(−2)
dx du dx 2

dy −1 1

= −u 2 = −(1 − 2 x) 2
dx

Second Derivative of A function

Differentiation can be repeated as many times as necessary on any given function. The
second derivative is important for the syllabuses covered by this manual as it is used to
determine whether a point is a maximum or minimum.

d2y
The second derivation of any function y is written as or y′′ and is obtained by
dx 2
differentiating a given function y twice.

356
Example 6

d2y
If y = 3x − 2 x + 5, find
2
a)
dx 2
d2y d
Then = ( 6 x − 2) = 6
dx 2 dx

d2y
b) If y = 5 x + 3 x + x − 6 x + 2, find
5 4 3

dx 2

d2y
Then 2
= 25 x 4 + 12 x 3 + 3 x 2 − 6
dx

d2y
= 100 x3 + 36 x 2 + 6 x
dx 2

The Practical use of Differentiation

Now that the idea of differentiation has been explained and the rules given for
differentiating common functions, it is time to look at practical examples.

Example 7

A firm has analyzed their operating conditions, prices and costs. The Cost Accountant
have developed the following functions.

Revenue K ( R ) = 350Q − 5Q 2 and cost K (C )= Q 2 + 20Q + 60 where Q is the number of

units sold. The firm wishes to maximize profit and wishes to know

a) What quantity should be sold?

b) At what price
c) What will be the amount of profit?

357
a) Profit = Total revenue – Total Cost
= 350Q − 5Q 2 − (Q 2 + 20Q + 60)
= −6Q 2 + 330Q − 60.

d ( profit )
= 12Q + 330
dQ
d ( profit )
equaiting
dQ
to 0 implies − 12Q + 330 = 0

Q = 27.5

d 2 ( profit )
= −12 < 0 implies maximum profit when Q = 27.5 . Therefore
dQ 2
the firm should sell 27.5 units to maximize profit.

Alternatively From basic economic theory it will be recalled that profit is

maximized when Marginal Revenue = Marginal Cost.

R = 350Q − 5 P 2
D( R)
MR = = 350 − 10Q
dQ
C = Q 2 + 20Q + 60
d (C )
MC = = 2Q+ 20
dQ

point of profit maximization is when

d ( R ) d (C )
MR = MC or =
dQ dQ
i.e 350 − 10Q = 2Q + 20
330 = 12Q
Q = 27.5

358
b) Total Revenue

= 350(27.5) − 5(27.5) 2
= 9625 − 3781.25
= 5843.75

27.5 units will be sold for 5843.75 kwachas.

5843.75
The price will be = K 212.50
27.5

c) Total Profit = revenue - Cost

revenue from above = K5 843.75 from above and

Cost = (27.5) 2 + 20(27.5) + 60

= 756.25 + 550 + 60
= K1366.25

Therefore profit = K5 843.75 – K1 366.25

= K4 477.5.

Procedure for identifying the turning points of a curve.

Using differentiation techniques, turning points of curves can be identified using three
steps. We shall show this by means of an example.

Example 8
1 2
Suppose the function y = x − 2 x + 15 is a production function where y is the cost (in
4
million of kwachas) of manufacturing x (in hundreds) items for some process. The
procedure is as follows:

dy dy 1
Step 1 : Obtain for the given function = x−2
dx dx 2

359
 dy
Step 2: Solve the equation = 0 , which will give the x-coordinates of any
dx
turning points that exists.

dy 1 1
Since = x − 2 the equation x − 2 = 0 needs to solved. x = 4.
dx 2 2
2
d y
Step 3: Evaluate at which (and any) x value found in Step 2.
dx 2

d2y
> 0 signifies a Minimum point;
dx 2

d2y
< 0 signifies a Maximum point
dx 2

dy 1 d2y 1
In our example, = x − 2, therefore 2 = .
dx 2 dx 2

1
Thus the turning point at x = 4 is a minimum since > 0. Hence, 400 items must be
2
manufactured in order to minimize total costs. The minimum total cost at this value of x
1
is y = (4) 2 − 2(4) + 15 = 4 − 8 + 15 = 11 (million kwacha).
4

Example 9

Determine the coordinates and nature of any turning points on the curve represented by
2 x3 2 x3
the function y = 18 x − . Solve y = 18 x − ,
3 3

dy d2y
= 18 − 2 x 2 and = 0 gives
dx dx 2

18 − 2 x 2 = 0
x2 = 9
x = ±3

2 3
The turning points exist on the curve y = 18 x − x at x = 3 and − 3.
3

360
 d2y d2y
Note that when = −4 x and x = 3, 2 = −4(3) = −12 < 0 Signifying a maximum.
dx 2 dx
2
d y
When − −3, 2 = −4(−3) = 12 > 0, signifying a minimum.
dx

Substituting x = 3 into the original equation will give the y-coordinate of the maximum
2
as: y = 18(3) − (3)3 = 54 − 18 = 36. Hence, the maximum point for the curve is at
3
x = 3 and y = 36 or (3,36).

Similarly, substituting x = −3 into the original equation will give the y-coordinate of the
2
minimum as: y = 18(−3) − (−3)3 = −54 + 18 = −36 . Hence, the minimum point for the
3
curve is at x = −3 and y = −36 or (−3,−36).

Example 10

Find the rate of change of y = x 6 with respect to x and evaluate it when x = 2 and when
x = −1 . Interpret your results.

dy
= 6 x5
dx

dy
When x = 2, then = 6(2)5 = 192 . This means that if x increases by a small amount,
dx
then y increases approximately 192 times as much. More simply we say that y is
dy
increasing 192 time as fast as x decreases. When x = 1, then = 6(−1)5 = −6. The
dx
importance of the minus sign is that y is decreasing 6 times as fast as x increases.

Integration

As mentioned earlier, integration can be regarded as the reverse process to differentiation.

For example, since differentiating 5 x 4 gives 20 x 3 , integrating 20 x 3 should give 5 x 4 .

The problem occurs when differentiating a constant. This is because it always gives zero.
Example, 5 x 2 + 2; 5 x 2 − 3; 5 x 2 + 9 are the same function when differentiated with
respect to x . Hence the derivative is 10 x . Therefore, the best that can be done is to

361
integrate 10 x to give 5 x 2 + C , where C is some arbitrary constant. If conditions are
given about the function under integration, we can find the particular value of C.

x n +1
The rule for integrating a simple function x is ∫ x dx = n n
+ C where ∫ represents
n
‘the integral of’ and x is the variable of integration. Note that C is the constant of
integration.

Example 11

Find the integrals of functions

8 x 3+1 5 x1+1 8 5 5
∫ (8 x + 5x)dx = + + C = x 4 + x 2 + C = 2 x 4 + x 2 +C
3
a)
3 +1 1+1 4 2 2

7 2
∫ (7 x − 2 x + 5)dx = x − x 2 + 5 x +C
2
b)
3

c) ∫ (10 x + 2)dx = 5 x 2 + 2 x +C

1
3 5 32 3
d) ∫ ( 2 . 5 x 2
+
4
) dx =
3
x + x+C
4

dy
e) If = x + 5 and y = 5 when x = 0, find y in terms of x .
dx

dy
Now integrating will give y . That is, y = ∫ ( x + 5)dx = x 2 + 5 x +C. But
dx
y = 5 when x = 0. 0 2 + 5(0) +C= 5 giving C = 5. Thus y = x 2 + 5 x + 5.

362
Example 12

The total revenue obtained (in million of kwacha) from selling x hundred items in a
particular month is given by R which is a function of variable x .

dR
Given that = 50 − 2 x
dx

a) Determine the total revenue function R;

b) Find the number of items sold on one day that will maximize the total revenue
and evaluate this total revenue.

dR
∫ dx dx = ∫ (50 − 2 x)dx = 50 x − x +C
2
a) Revenue =

When no items are sold revenue will be zero. That is R = 50(0) − (0) 2 +C= 0
So that, R = 50 x − x 2 .
b) The value of x that maximizes revenue R is found by solving the equation

dR
= 0. That is 50 − 2 x = 0
dx

x = 25

d 2R
= −2 < 0
dx 2

confirms that when x = 25 , the total revenue is maximized. Hence 2 500 items
should be sold per month to maximize revenue. This maximum revenue is
R = 50(25) − (25) 2 = K 625 000 000.

363
Exercise 3

Differentiate each of the following functions

1) y=5 2) y = 5 + 3x 3) y = 3x 6

x5 + 5 x 2
4) f ( s ) = s ( s + 5)
3 3
5) f ( x) = 5 x 6) y=
3x

z2 +1
7) f ( z) =
z2 −1

8) The cost function is c = q 2 − 15q + 500 where q = quantity of units produced.

Find the point of minimum cost.

9) If c = 0.005q 3 − 0.04q 2 + 6q + 12 000 us a total cost function, find the marginal

cost when q = 50.

10) A process has a total cost function give by c = 50 + 10 x and a revenue function
given by R = 88 x − 8 x 2 , where x is the level of activity (in hundreds). The
cost(C) and revenue (R) are both in units of a million kwacha.

a) Derive an expression for the total profit (P).

b) Calculate the level of activity that maximizes profit and the amount of
profit at this level.

c) What is the profit situation when 500 units are produced.

364
 EXAMINATION QUESTIONS WITH ANSWERS

MULTIPLE CHOICE QUESTIONS

SECTION A

6
1.1. The derivation of the function, f ( x) = − 5 x is equal to:
x2
−3
1
− 12 5 x 2 5
a) 6 x − 5x
2 2
b) + c) − 12 x −
x 2 2 x

12 5
d) 3
−
x 2 x
(Natech, Mathematics and Statistics; December 2000)

1.2. Find the gradient of y = 3 x 2 + 2 x 2 + 4 x − 8 at x = 1 .

a) 17 b) 1 c) 27 d) -17

(Natech, Mathematics and Statistics; December 2004)

1.3. A firm’s output is given by Q = 120 L2 − 2 L4 , where L is the number of labour

hours in thousands. How many labour hors maximize output?

a) 30.0 b) 8.0 c) 24.0 d) 5.5

(Natech, 1.2 Mathematics and Statistics; June 2003)

1.4 The demand equation for a certain product is P ( x) = 500 − 0.0125 x where P (x)
is the price per unit, in kwacha and x is the quantity demanded. For what value of
x is revenue a maximum.

a) 20 000 b) 500 c) 0.0125 d) -0.025

(Natech, 1.2 Mathematics and Statistics; December 2002)

dy
1.5 What is of the following function? y = ( x 2 + 1) / x 3
dx
a) 2x 2 b) (−3 − x 2 ) c) ( −3 − x 2
3x x3 x4

d) − 3 x( x 2 + 1) + 2 x
(Natech, 1.2/B1 Mathematics and Statistics; December 1999 (Rescheduled))

365
 3

1.6. Find the derivative of the function Y = ( x 2 − 4) 2

3 1
3 2
A. 2( 2 x ) 2 B. 3 x ( x 2 − 4) 2 C. ( x − 4)
2
D. . None of these.
(Natech, 1.2 Mathematics and Statistics; December 1998)

dy
1.7 Find the differential coefficient, , of the following function y = (4 x 3 − 15 x 2 )8 .
dx

A. 8(4 x 3 − 15 x 2 )7 B. (4 x 3 − 15 x 2 )8 C. (12 x 2 − 30 x)(8)

D. 8(12 x 2 − 30 x)(4 x 3 − 15 x 2 )7

(Natech, 1.2 Mathematics and Statistics; December 1997)

1 5

1.8 If y = −12 x 2 − 3 x 2 , then which one of the following statements is true?

3
−1 −1 3
dy 15 x 2 dy
A. = −6 x 2 − B. = −12 x 2 − 3 x 2
dx 2 dx

3
dy 1 5 −1
C. = −12 x( ) x 2 − 3( ) x 2 D. none of these
dx 2 2

1.9 The total profit from selling x pencils is P ( x) = 20 x 2 − 7 x − 35 . The marginal

average profit function is equal to:

20 x − 7 20 x 2 + 35
A. 20 x − 7 x B. C.
x x2
20 x 2 − 7 x − 35
D.
x

1.10 If f ( x) = (3 x + 2)( x − 1), then f ′( x) using the product rule, is equal to:

A. 3 x( x − 1) + 2( x − 1) B. 6x − 1 C. 3x 2 − x − 2

D. (3)(1)

366
 SECTION B

1) Kango Pottery Ltd, a manufacturer of ornamental china plates estimates its profit
function to be P ( x) = 60 000 + 20 000 x − x 2 where x is the amount of money, in
kwacha, spent on advertising.

i) What amount spent on advertising will yield maximum profit?

ii) What is the maximum profit?

(Natech, 1.2 Mathematics and Statistics; June 2001)

2) Find the relative maximum and minimum values of the following function
f ( x) = − x 3 + 3x 2 + 9 x + 5

(Natech, 1.2 Mathematics and Statistics; December 1998)

3) a) Differentiate the function y = ( x 2 − 2 x + 1)100 with respect to x and

simplify your answer as much as possible.

b) A manufacturer knows that if x (in hundreds) products are demanded in a

particular week, the total cost function is 14 + 3 x and the total revenue
function is 19 x − 2 x 2 .

i) What is the total profit function?

ii) Find the profit break-even points

iii) Calculate the level of demand that maximizes profits and the
amount of profit obtained.

4) Find the point(s) where the gradients of the following equations are zero.

i) y = 20 + 18 x − 3 x 2
ii) y = 2 x3 − 3 x 2 − 36 x + 72
(Natech, 1.2 Mathematics and Statistics; June 2002)

367
5) a) A company has examined its cost structure and its revenue structure and
has determined that the following functions approximately describe its
costs and revenues C = 100 + 0.015 x 2 , where C = total cost and x =
number of units produced. , where R = 2 x total revenue and x = number
of units produced and sold. Find, by calculus method, the output which
will maximize profits for this company.

b) If R( x) = 29 x − 6 x 2 − 15, find:

i) the values of R(0) and R(3)

ii) the value of x, correct to nearest whole number, for which R(x) is
maximum.

(Natech, 1.2 Mathematics and Statistics; December 2002)

6) a) The revenue and cost function of product x have been identified as:

Total revenue (K’000) = − x 2 + 20 x

Total Cost (K’000) = 6 x + 21 were x = sales in units.

i) Determine the profit-maximizing price and quantity.

ii) Compute the maximum profit based on the results in (i) above.

b) Find the first derivative of:

− x 2 + 20 x
i) y=
6x

ii) y = (4 x 2 − x + 10)5

(Natech, 1.2 Mathematics and Statistics; December 2004)

1 3 2 3
7) a) Find the 1st derivative of the following T = t + t + t −1.
2 2

b) Find the points where the gradients of the following equations are zero.
y = 2 x3 − 3 x 2 − 36 x + 72
(Natech, 1.2 Mathematics and Statistics; December 2003)

368
8) a) In a certain office, examination and analysis of past records show that
there is a relationship between the number of clerks employed and the
average cost of processing an order for new business. If q is the number
1000 1
of clerks employed, average cost is given by C (q ) = + q
q 10

What value of q will minimize this expression?

b) Examine the following expression for maximum and minimum values

using the second derivation method y = x(12 − x) 2 .

(Natech, 1.2 Mathematics and Statistics; November/December 2000)

5
9) Differentiate the function given by y =
3 x4 + 2

(Natech, 1.2/B1 Mathematics and Statistics; December 1999 (Rescheduled))

369
 L
B limitations, 333
Basic Linear Programming, 331
binding constraint, 335
Business Mathematics Techniques, 302
M
Marginal Revenue, 359
Matrices, 302, 304
D matrix, 302, 303, 304, 305, 306, 308, 309, 310, 311,
decision variables, 332 312, 316, 317, 319, 320, 321, 322, 324, 326, 328,
Derivative, 353, 354, 357 329, 330, 331
Derivatives Functions, 356 Matrix Algebra, 302, 311
DIFFERENTIAL CALCULUS, 350
differential coefficient, 367
Differentiation, 351, 352, 357, 358
Q
Quadratic Functions, 352
E
elementary calculus, 351
S
Simple Function, 353
Simple Functions, 351
I Simultaneous Equations, 311
Integration, 351, 362
Inverse, 308, 324

370