10Spring.Lecture Notes.Math

10Spring.Lecture Notes.Math - Variables move in the...

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Managerial Economics Managerial Economics (ECON 5203) Dr. David L. May Oklahoma City University
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Math Review Models Mathematical Variables Things that may be quantified Values subject to change Dependent/Independent LHS and RHS Causation and Association Represented by “symbols” W = the weight in pounds of person i 10/22/10 2 Managerial Economics
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Math Review (cont) Functions Y = f (X); the value of the variable Y is a function (depends on) the value of the variable X Linear functions Y = a + bX (note that here, a and b are “parameters” of the linear relationship between Y and X) a is the Y intercept and b is the slope coefficient Graphs Vertical Axis and Horizontal Axis Dependent Variable on Vertical, Independent on Horizontal 10/22/10 3 Managerial Economics
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Math Review (cont) Relationships between Variables Negative (indirect, inverse)
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Unformatted text preview: Variables move in the opposite directions Downward-sloping line Positive (direct) Variables move in the same direction Upward sloping line 10/22/10 4 Managerial Economics Math Review (cont) Optimization Maximums and Minimums (Max Profits & Min Costs) Slope at Max/Min = 0 Max/Min of any function occurs where slope = 0 Slope = change in one variable relative to another Derivative = change in one variable relative to another Marginal = change, additional, next, etc. 10/22/10 5 Managerial Economics Math Review (cont) Optimization If = TR TC To Maximize , the change in must be 0 Change in is called Marginal Profit To maximize Total Profit, we find where Marginal (change in) Profit is 0 10/22/10 6 Managerial Economics...
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This note was uploaded on 10/21/2010 for the course ACCT 12345 taught by Professor Beth during the Spring '10 term at Oklahoma City Community College.

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10Spring.Lecture Notes.Math - Variables move in the...

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