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Differential equations may be used when time is assumed to be continuous. However, difference
equations may be used when time is assumed to be discrete (i.e. not continuous). For discrete
time t, then usually t can only take the values 0, 1, 2, 3, … (for example, if interest is added to a
bank account once a year). Difference equations are also known as recurrence relations.
The objective is to solve the equation (∆) to find an expression for yt in terms of t.
Please don’t remember the expression for y*, since, as you will see in the following example, y*
is very easy to find directly from the given equation.
5
(Ex 1) Solve the equation yt + 1 = 5yt + 6 if y0 = , and describe the long-term behaviour.
2
(Solution)
yt + 1 = ayt + b, where a = 5 and b = 6.
3
Let y* = yt + 1 = yt. Then, y* = 5y* + 6 ∴ 4y* = –6 ∴ y* = –
2
Page 1 of 36
Mathematics 2 : Difference Equations
b
If the solution is of the form yt = y* + (y0 – y*)at where y* = , then the behaviour of yt
1− a
depends only on the constant a, for large values of t.
The following graphs illustrate the behaviour of at as t → ∞. Strictly speaking, we should not
join up the points since t is discrete (i.e. t = 0, 1, 2, …). However, in practice, we normally just
produce a smooth curve. However, I do not expect you to be asked to sketch the graph of the
solution to a difference equation in this course.
at at
1 0<a<1
1 a>1
0 t 0 t
at at
1 –1 < a < 0 a < –1
0 t 0 t
Page 2 of 36
Mathematics 2 : Difference Equations
(Ex 2) Suppose that a savings account pays interest annually at the rate of 5% p.a. An investor
deposits an amount $P and, at the end of each year for the next 12 years, withdraws $300
from the account. Let yt be the amount in the account at the end of t years.
(a) Create a first-order difference equation involving yt and yt – 1, and solve it.
(b) Given that the balance in the account is zero at the end of the 12 years, find P.
(Solution)
(a) yt = the amount at the end of year t
y0 = P
Page 3 of 36
Mathematics 2 : Difference Equations
Cobweb Model
Suppose we have one commodity with a supply equation and a demand equation, but allow a
time-lag in the actions of the suppliers. By this, I mean that the model’s current supply depends
upon the previous period’s price.
Suppose the standard supply and demand equations are of the form
Supply: Qs = bP – a
Demand: Qd = c – dP
If you have to write down the cobweb equations from the original equations, then remember to
replace P by Pt – 1 in the supply equation only.
These new time-dependent supply and demand equations form a cobweb model, so named
because the graph obtained by joining up the points (P0, Qd0), (P0 , Qs1), (P1 , Qd1), (P1 , Qs2),
(P2 , Qd2), … etc, produce a figure similar to a spiralling cobweb.
The time-independent equilibrium point (Q*, P*) is easily obtained by solving the equation
Qs = Qd, letting P* = Pt = Pt – 1 and Q* = Qt. In a cobweb model question, I suggest you find
(Q* , P*) first.
The next step is to solve the equation Qst = Qdt to find an expression for Pt in terms of t. When
you equate the supply and demand cobweb equations, you will obtain a first-order difference
equation. After you have solved this equation to find the time path of Pt, you should then use
the demand cobweb equation to find the time path of Qt.
Cobweb Stability
Let P* and Q* be the equilibrium price and quantity.
However, it is possible to determine the cobweb stability just looking at the coefficients of P in
the supply and demand equations. You could remember the following conditions:
Page 4 of 36
Mathematics 2 : Difference Equations
Cobweb Stability
b
If <1 then the time path Pt converges, oscillating with decreasing
d
magnitude, so that Pt → P* as t → ∞. The cobweb is stable.
b
If =1 then the time path Pt oscillates uniformly.
d
The cobweb is not exploding or converging.
b
If >1 then the time path Pt explodes, oscillating with increasing
d
magnitude, so that Pt → ±∞ as t → ∞.
The cobweb explodes (unstable cobweb).
Cobweb Graph
(1) Draw the Qt-axis and Pt-axis (I usually put the Qt-axis horizontally).
(2) Draw the supply and demand (time-independent) lines, labelling these. Include the
values where these lines meet the axes.
(3) The supply and demand lines should intersect at the equilibrium point (Q*, P*).
Mark Q* and P* on the axes.
(4) The starting point of the cobweb graph is always on the demand line, corresponding to
P0, which you will be given. The cobweb graph is a continuous series of horizontal and
vertical lines, beginning with a horizontal line. The horizontal lines always end at the
supply line, while the vertical lines always end at the demand line. Put a directional
arrow on each line of the cobweb graph, unless the cobweb graph becomes too
congested.
Page 5 of 36
Mathematics 2 : Difference Equations
You may be asked to join the points (P0 , Qd0), (P0 , Qs1), (P1 , Qd1), (P1 , Qs2), (P2 , Qd2), … etc
on a two-dimensional graph. Note that Q1 = Qd1 = Qs1, and Q2 = Qd2 = Qs2, etc.
You would already have found equations for the time paths of Pt and Qt. Use these equations to
find P1, P2 and Q0, Q1, Q2 . For example, to find Q0, just put t = 0 in the equation for Qt.
Pt Supply
P0 Stable Cobweb
P*
P1
Demand
0 Q0 Q* Q1 Qt
Pt
Supply
P1 Exploding Cobweb
P*
P0
Demand
0 Q1 Q* Q0 Q2 Qt
(Ex 3) Comment on the stability of the cobweb model with supply and demand as follows:
Qst = 5Pt – 1 – 12
Qdt = 8 – 2Pt
(Solution)
b 5
Qst = bPt – 1 – 12 and Qdt = 8 – dPt where = > 1.
d 2
*************************************************************
Page 6 of 36
Mathematics 2 : Difference Equations
(Solution)
qt = 40 – 12pt ……………………… (1)
qt = 15pt – 1 – 41 …………………… (2)
Equating (1) and (2),
40 – 12pt = 15pt – 1 – 41
∴ 12pt = –15pt – 1 + 81
∴ pt = –1.25pt – 1 + 6.75 ……………… (∆)
(∆) is of the form pt = apt – 1 + b, where a = –1.25 and b = 6.75
Let p* = pt – 1 = pt. Then, p* = –1.25p* + 6.75 ∴ 2.25p* = 6.75 ∴ p* = 3
General solution: pt = p* + (p0 – p*)at and we are told that p0 = 2.5
Complete solution: pt = 3 + (2.5 – 3)(–1.25)t
1
∴ pt = 3 – (–1.25)t
2
1
From (1), qt = 40 – 12pt = 40 – 12[3 – (–1.25)t] = 40 – 36 + 6(–1.25)t = 4 + 6(–1.25)t
2
1
Hence, pt = 3 – (–1.25) and qt = 4 + 6(–1.25)t
t
2
Behaviour:
–1.25 < –1 and so (–1.25)t → ±∞ as t → ∞, oscillating with increasing magnitude about 0
Hence, pt → ±∞ as t → ∞, oscillating with increasing magnitude about pt = 3,
and qt → ±∞ as t → ∞, oscillating with increasing magnitude about qt = 4.
Page 7 of 36
Mathematics 2 : Difference Equations
(Ex 5)Suppose supply, QSt, for a particular product in year t depends upon the price, Pt – 1, in
the previous year, t – 1, as follows
Suppose further that the demand, QDt, is a function of current year prices according to
QDt = c + bPt , with b < 0.
(a) Assuming market equilibrium, create and solve a first order difference equation in Pt.
(b) Given g = –30, c = 180, P0 = 220 show how the behaviour of the solution Pt depends
upon the parameters h and b and illustrate your answer with the particular cases of
(c) For (b)(i), draw a sketch graph of the solution series for Qt (= QSt = QDt) and Pt in order
to demonstrate why the model is often referred to as the cobweb model.
(Solution)
(a) The time-independent equilibrium occurs when
c−g
QS = QD ∴ g + hP = c + bP ∴ P(h – b) = c – g ∴ P* = ∴ Q* = g + hP*
h−b
c−g
Hence, the time-independent equilibrium occurs at P* = and Q* = g + hP*
h−b
The cobweb equations are
QSt = g + hPt – 1 …………………… (1)
QDt = c + bPt ……………………… (2)
Page 8 of 36
Mathematics 2 : Difference Equations
h g −c
Pt = Pt – 1 + ……………………………… (∆)
b b
t
h c−g
The solution of (∆) is Pt = P* + (P0 – P*) , where P* =
b h−b
Pt = 200 + 20(–0.4)t
∴ Pt → P* = 200 as t → ∞, oscillating with decreasing magnitude.
Cobweb converges to (Q*, P*), i.e. (30, 200). Cobweb is stable.
Pt = 350 – 130(–1)t
∴ Pt oscillates uniformly about P* = 350.
Cobweb oscillates uniformly about (Q*, P*), i.e. (75, 350).
The cobweb is not converging or exploding.
Pt = 525 – 305(–3)t
(Q*, P*) = (127.5, 525). Cobweb explodes. Cobweb is unstable.
∴ Pt → ±∞ as t → ∞, oscillating with increasing magnitude about 525.
Page 9 of 36
Mathematics 2 : Difference Equations
QS = –30 + 0.3P
QD = 180 – 0.75P , where Q* = 30, P* = 200
Pt
Supply
240
P0 220 Stable Cobweb,
converging to (Q*, P*)
P2
P* 200
P1 192
100
Demand
0 15 30 36 180 Qt
Q0 Q2 Q* Q1
Page 10 of 36
Mathematics 2 : Difference Equations
The method of solving (∆), to find an expression for yt in terms of t, is similar to the method we
use to solve second-order differential equations.
The first step in solving (∆) to find yt, is to find the general solution of the corresponding
homogeneous equation:
ayt + 2 + byt + 1 + cyt = 0 …………………… (*)
The general solution of (*) is also the complementary function for (∆).
You must remember the form of the complementary function for each of the three cases, as
given in the following table.
Page 11 of 36
Mathematics 2 : Difference Equations
Choosing a Particular Solution
If any of the terms in your first choice of particular solution have the same form as any terms in
the complementary function, then you must modify your first choice of the particular solution by
multiplying each of the affected terms (i.e. terms in the same row as the troublesome term in
above table) in the particular solution by t.
Page 12 of 36
Mathematics 2 : Difference Equations
(Ex 6) Solve the following difference equation given that y0 = 2 and y1 = 31.
yt + 2 + 5yt + 1 – 14yt = 0 ……………………. (∆)
(Solution)
Auxiliary equation: m2 + 5m – 14 = 0 ∴ (m + 7)(m – 2) = 0 ∴ m = –7 or m = 2
Complementary function: yt = A(–7)t + B(2)t
(Solution)
Auxiliary equation: m2 – 5m + 6 = 0
∴ (m – 2)(m – 3) = 0
∴ m = 2 or m = 3
Page 13 of 36
Mathematics 2 : Difference Equations
(Ex 8) Solve the following difference equation given that y0 = 6 and y1 = 10.
yt – 5yt – 1 + 6yt – 2 = 12t – 2
Check your answer by finding y2 using both the given equation and your answer.
(Solution)
yt – 5yt – 1 + 6yt – 2 = 12t – 2 ………………… (∆)
Auxiliary equation: m2 – 5m + 6 = 0
∴ (m – 2)(m – 3) = 0
∴ m = 2 or m = 3
Complementary function: yt = A(2)t + B(3)t
Equating coefficients,
t terms: 2D = 12 ∴ D = 6
Constant terms: –7D + 2E = –2 ∴ 2E = 40 ∴ E = 20
Particular solution: yt = 6t + 20
*******************************************************************
Page 14 of 36
Mathematics 2 : Difference Equations
(Ex 9) Solve the following difference equation given that y0 = 5 and y1 = 11.
yt + 2 – yt + 1 – 12yt = –12(3)t …………… (∆)
(Solution)
Auxiliary equation: m2 – m – 12 = 0 ∴ (m + 3)(m – 4) = 0 ∴ m = –3 or m = 4
Complementary function: yt = A(–3)t + B(4)t
For a particular solution, try yt = D(3)t
From (∆), D(3)t + 2 – D(3)t + 1 – 12D(3)t = –12(3)t
∴ 9D – 3D – 12D = –12 ∴ –6D = –12 ∴ D = 2
Particular solution: yt = 2(3)t
General solution: yt = PS + CF ∴ yt = 2(3)t + A(–3)t + B(4)t ……. (GS)
y0 = 5, so 2 + A + B = 5, so A + B = 3, so 3A + 3B = 9 …………… (1)
y1 = 11, so 6 – 3A + 4B = 11, so –3A + 4B = 5 …………………… (2)
(1) + (2): 7B = 14, so B = 2, so A = 3 – 2 = 1
Hence, the complete solution to (∆) is yt = 2(3)t + (–3)t + 2(4)t
*******************************************************************
(Ex 10) Using yt = Dt for a particular solution,
solve the following difference equation given that y0 = 30 and y1 = 20.
yt + 2 – 3yt + 1 + 2yt = 12 …………… (∆)
(Solution)
Auxiliary equation: m2 – 3m + 2 = 0 ∴ (m – 1)(m – 2) = 0 ∴ m = 1 or m = 2
Complementary function: yt = A(1)t + B(2)t = A + B(2)t
For a particular solution, try yt = Dt (as instructed)
From (∆), D(t + 2) – 3D(t + 1) + 2Dt = 12
∴ Dt + 2D – 3Dt – 3D + 2Dt = 12 ∴ –D = 12 ∴ D = –12
Particular solution: yt = –12t
General solution: yt = PS + CF ∴ yt = –12t + A + B(2)t ………… (GS)
y0 = 30, so A + B = 30 ……………………………………………. (1)
y1 = 20, so –12 + A + 2B = 20, so A + 2B = 32 …………………… (2)
(2) – (1): B = 2, so A = 30 – 2 = 28
Hence, the complete solution to (∆) is yt = –12t + 28 + 2(2)t
*****************************************************************
Page 15 of 36
Mathematics 2 : Difference Equations
(Solution)
yt + 2 – 8yt + 1 + 16yt = 64(4)t ……………… (∆)
Auxiliary equation: m2 – 8m + 16 = 0
∴ (m – 4)(m – 4) = 0
∴ m=4
Complementary function: yt = (At + B)(4)t = At(4)t + B(4)t
General solution: yt = PS + CF
∴ yt = 2t2(4)t + (At + B)(4)t
∴ yt = (2t2 + At + B)(4)t …………… (GS)
y0 = 3, so B = 3
y1 = 36, so 4(2 + A + B) = 36, so 2 + A + 3 = 9, so A = 4
Page 16 of 36
Mathematics 2 : Difference Equations
(Ex 12) Solve the following difference equation given that y0 = 6 and y1 = 15.
3yt – 6yt – 1 + 12yt – 2 = 7(3)t + 9 ………………… (∆)
(Solution)
Auxiliary equation: 3m2 – 6m + 12 = 0 ∴ m2 – 2m + 4 = 0 ∴ b2 – 4ac = 4 – 16 = –12 < 0
−b 6 1 π 1
θ = cos −1 = cos −1 = cos −1 = , since cos(60°) =
2 ac 2 36 2 3 2
t
c
a = ( 4) t
= (2)t
tπ tπ
Complementary function: yt = (2)t(Acos + Bsin )
3 3
For a particular solution, try yt = D(3)t + E
From (∆), 3D(3)t + 3E – 6D(3)t – 1 – 6E + 12D(3)t – 2 + 12E = 7(3)t + 9
Constant terms: 9E = 9 ∴ E = 1
Remaining terms: 3D(3)t – 6D(3)t – 1 + 12D(3)t – 2 = 7(3)t
4
∴ 3D – 2D + D = 7 ∴ 3D + 4D = 21 ∴ 7D = 21 ∴ D = 3
3
General solution: yt = PS + CF
tπ tπ
∴ yt = 3(3)t + 1 + (2)t(Acos + Bsin ) ………….. (GS)
3 3
y0 = 6 ∴ 3 + 1 + A = 6 ∴ A = 2
1 3
y1 = 15 ∴ 9 + 1 + 2[2cos(60°) + Bsin(60°)] = 15 ∴ 2[2 + B ] = 5
2 2
∴ 2+ 3B =5 ∴ 3B = 3 ∴ B = 3
tπ tπ
Hence, the complete solution to (∆) is yt = 3(3)t + 1 + (2)t(2cos + 3 sin )
3 3
***********************************************************************
1 1
If θ = cos −1 , say, then your final answer must involve cos −1 , and it is possible to
4 4
evaluate the constants A and B, since we can use the identity cos (θ) + sin2(θ) = 1.
2
Page 17 of 36
Mathematics 2 : Difference Equations
(Ex 13) Solve the following difference equation given that y0 = 4 and y1 = 9.
yt – 2yt – 1 + 6yt – 2 = 15 ………………… (∆)
(Solution)
Auxiliary equation: m2 – 2m + 6 = 0 ∴ b2 – 4ac = 4 – 24 = –20 < 0
−b 2 1 1
θ = cos −1 = cos −1 = cos −1 , in first quadrant since >0
2 ac 2 6 6 6
t
c
a = ( 6) t
General solution: yt = PS + CF
y0 = 4 ∴ 3 + A = 4 ∴ A = 1
2
1 1 5
cos2(θ) + sin2(θ) = 1, so sin2(θ) = 1 – =1– = and sin(θ) > 0
6 6 6
5
So sin(θ) =
6
y1 = 9 ∴ 3 + 6 [cos(θ) + Bsin(θ)] = 9
1 5
∴ 6[ +B ]=6
6 6
∴1+ 5B=6
∴ 5B=5
∴ B= 5
Page 18 of 36
Mathematics 2 : Difference Equations
Behaviour Of Solutions
After solving a second-order equation, you may be asked to describe the behaviour of the time
path.
Stability
The solution yt is stable if yt converges to a finite limit. For example, if yt → 6 as t → ∞.
If the solution yt does not converge to a finite limit, then yt is unstable.
Important Limits
If –1 < r < 1 then rt → 0 as t → ∞
If r < –1 or r > 1 then rt → ∞ or ±∞ as t → ∞ (depending on sign of r)
Examples (Behaviour)
t
t t t2
(1) Suppose yt = 32 + 3 – 2 = 32 + 3 [1 – ]
3
t
2 2
Then, yt → ∞ as t → ∞, since 0 < < 1 so that → 0 as t → ∞
3 3
t
2
(2) Suppose yt = 32 + 2t – 3t = 32 – 3t[1 – ]
3
t
2 2
Then, yt → –∞ as t → ∞, since 0 < < 1 so that → 0 as t → ∞
3 3
***********************************************************************
Page 19 of 36
Mathematics 2 : Difference Equations
(Ex 14) Solve the following difference equation given that y0 = 0 and y1 = 1.
yt + 12yt – 1 + 11yt – 2 = 24
How does the solution behave for large t?
(Solution)
yt + 12yt – 1 + 11yt – 2 = 24 ………………………………… (∆)
Auxiliary equation: m2 + 12m + 11 = 0
∴ (m + 1)(m + 11) = 0
∴ m = –1 or m = –11
y0 = 0 ∴ 1 + A + B = 0 ∴ A + B = –1 …………………………. (1)
y1 = 1 ∴ 1 – A – 11B = 1 ∴ –A – 11B = 0 ……………………… (2)
1
(1) + (2): –10B = –1 ∴ B =
10
1 11
From (1), A + = –1 ∴ A = –
10 10
11 1
Hence, the complete solution to (∆) is yt = 1 – (–1)t + (–11)t
10 10
Page 20 of 36
Mathematics 2 : Difference Equations
3 2
(Ex 15) Find the eigenvalues of the matrix A =
1 4
and find an eigenvector corresponding to each eigenvalue.
Hence find an invertible matrix P and a diagonal matrix D such that P–1AP = D.
Hence, or otherwise, find the solutions for xt and yt such that x0 = 4 and y0 = 1 and
xt = 3xt – 1 + 2yt – 1
yt = xt – 1 + 4yt – 1
(Solution 1)
3−λ 2
A – λI = = (3 – λ)(4 – λ) – 2 = 12 – 7λ + λ2 – 2
1 4−λ
wt xt − 1 w w w
P = A = AP t − 1 , so P–1P t = P–1AP t − 1
z
zt yt − 1 zt − 1 zt t −1
wt wt − 1 wt wt − 1 wt 2 0 wt − 1 2wt − 1
So, I = D , so
= D , so
= =
zt zt − 1 zt zt − 1 zt 0 5 zt − 1 5 zt − 1
So, wt = 2wt – 1 and zt = 5zt – 1 (geometric sequences with r = 2 and r = 5)
So, wt = w0(2)t and zt = z0(5)t. So, wt = –(2)t and zt = 2(5)t
xt − 2 1 − (2)t 2(2)t + 2(5) t
(1) ⇒ = =
t
t
yt 1 1 2(5) − (2) + 2(5)
t
Page 21 of 36
Mathematics 2 : Difference Equations
(Solution 2)
3−λ 2
A – λI = = (3 – λ)(4 – λ) – 2 = 12 – 7λ + λ2 – 2
1 4−λ
xt xt − 1
In matrix form, the given system is = A
yt yt − 1
x1 x0 x2 x1 x0 x3 x2 x0
So, = A and = A = A2 and = A = A3
y1 y0 y2 y1 y0 y3 y2 y0
xt x0 x0 1 2 1 (2)t 0 1 − 1 4
So, = At = PD tP–1 =
yt y0 y0 3 − 1 1 0 (5) t 1 2 1
1 2( 2) t (5) t 3
=
− ( 2) t (5) t
3 6
2( 2) t (5) t 1
=
− ( 2)
t
(5) t 2
2(2) t + 2(5) t
=
t
− (2) + 2(5)
t
Page 22 of 36
Mathematics 2 : Difference Equations
(Solution 3)
xt = 3xt – 1 + 2yt – 1 ………………………… (1)
yt = xt – 1 + 4yt – 1 …………………………. (2)
1
(1) ⇒ yt – 1 = (xt – 3xt – 1) ………………………. (3)
2
1
⇒ yt = (xt + 1 – 3xt) …………………………. (4) , replacing t by t + 1
2
1
(xt + 1 – 3xt) = xt – 1 + 2(xt – 3xt – 1) , putting (3) and (4) into (2)
2
x0 = 4 ∴ A + B = 4 ∴ 2A + 2B = 8 …….. (5)
x1 = 14 ∴ 2A + 5B = 14 …………………. (6)
(6) – (5): 3B = 6 ∴ B = 2
From (5), A + 2 = 4 ∴ A = 2
Hence, the complete solution to (∆) is xt = 2(2)t + 2(5)t
1 1
yt = (xt + 1 – 3xt) = [2(2)t + 1 + 2(5)t + 1 – 6(2)t – 6(5)t] , from (4)
2 2
1
= [4(2)t + 10(5)t – 6(2)t – 6(5)t]
2
********************************************************************
Page 23 of 36
Mathematics 2 : Difference Equations
If a first order difference equation is of the form yt + ayt – 1 = f(t) or yt + 1 + ayt = f(t), where f(t) is
not a constant then we can solve the equation using the method for solving a second order
difference equation.
(Solution)
yt + 1 – 12yt = 33 – 20(7)t ………..………………… (∆)
Auxiliary equation: m – 12 = 0 ∴ m = 12
Complementary function: yt = A(12)t
General solution: yt = PS + CF
∴ yt = –3 + 4(7)t + A(12)t ……………….. (GS)
y0 = 6, so –3 + 4 + A = 6, so A = 5
Hence, the complete solution to (∆) is yt = –3 + 4(7)t + 5(12)t
*******************************************************************
Page 24 of 36
Mathematics 2 : Difference Equations
Revision Problems
1. Solve the following difference equations, and describe the long-term behaviour of yt.
1
(a) yt = 8yt – 1 + 3, y0 = 2 (b) yt = 60 – yt – 1, y0 = 70
2
3. The following equations relate to consumption Ct, Investment It, Income Yt and
Production Qt, at time t:
3 1
Ct = Yt – 1 , It = 20 + (Qt – 1 – Qt – 2) , Qt = Yt , Yt = Ct + It
8 8
Page 25 of 36
Mathematics 2 : Difference Equations
(c) Suppose that the sequence of prices pt and quantities qt are determined by the two
equations
qt = qS(pt – 1) , pt = pD(qt)
Derive a first-order difference equation for pt.
Page 26 of 36
Mathematics 2 : Difference Equations
1. (a) yt = 8yt – 1 + 3
yt = ayt – 1 + b, where a = 8 and b = 3.
3
Let y* = yt = yt – 1. Then, y* = 8y* + 3 ∴ 7y* = –3 ∴ y* = –
7
t
General solution: yt = y* + (y0 – y*)a
3 3 3 17
y0 = 2 ∴ The complete solution is yt = – + 2 + 8t ∴ y t = – + (8)t
7 7 7 7
Page 27 of 36
Mathematics 2 : Difference Equations
Page 28 of 36
Mathematics 2 : Difference Equations
General solution: yt = PS + CF
∴ yt = 2t(–5)t + A(–5)t + B(2)t ……………………. (GS)
y0 = 1, so A + B = 1, so 2A + 2B = 2 ……………………………… (1)
y1 = 6, so –10 – 5A + 2B = 6, so –5A + 2B = 16 ………………….. (2)
(1) – (2): 7A = –14, so A = –2, so B = 1 + 2 = 3
Hence, the complete solution to (∆) is yt = 2t(–5)t – 2(–5)t + 3(2)t
***********************************************************************
2. (e) yt + 2 + 4yt = 15 …………………………………………………….. (∆)
Auxiliary equation: m2 + 4 = 0 ∴ b2 – 4ac = –16 < 0 ∴ complex roots
t
−b
θ = cos
−1
= cos–1 (0) =
1 c
π and =
( 4) t
= (2)t
2 ac 2 a
1 1
Complementary function: yt = (2)t[Acos πt + Bsin πt ]
2 2
For a particular solution, try yt = D
From (∆), D + 4D = 15 ∴ 5D = 15 ∴ D = 3
Particular solution: yt = 3
1 1
General solution: yt = PS + CF ∴ yt = 3 + (2)t[Acos πt + Bsin πt ] ……… (GS)
2 2
y0 = 12 ∴ 12 = 3 + A ∴ A = 9
y1 = 11 ∴ 11 = 3 + 2B ∴ 2B = 8 ∴ B = 4
1 1
Hence, the complete solution to (∆) is yt = 3 + (2)t[9cos πt + 4sin πt ]
2 2
Page 29 of 36
Mathematics 2 : Difference Equations
y0 = 6, so 5 + A = 6, so A = 1
3A B
y1 = 8, so 5 + 3 + = 8, so 10 + 3 + 3 B = 16, so B = 3
2 2
***********************************************************************
3
3. (a) Ct = Yt – 1 ………………………………………. (1)
8
1
It = 20 + (Qt – 1 – Qt – 2) ………………………… (2)
8
Qt = Yt ……………………………………………. (3)
Yt = Ct + It ………………………………………… (4)
1
∴ It = 20 + (Yt – 1 – Yt – 2) ………………………….. (5) , putting (3) into (2)
8
3 1
∴ Yt = Yt – 1 + 20 + (Yt – 1 – Yt – 2) , putting (1) and (5) into (4)
8 8
3 1 1
∴ Yt = Yt – 1 + Yt – 1 – Yt – 2 + 20
8 8 8
1 1
∴ Yt – Yt – 1 + Yt – 2 = 20 ………………………… (∆)
2 8
Page 30 of 36
Mathematics 2 : Difference Equations
1 1
3. (b) Auxiliary equation: m2 – m+ =0
2 8
1 1 1
∴ b2 – 4ac = – =– < 0 ∴ complex roots
4 2 4
1
t
c = cos −1 8 = cos −1 2 2
t
−1 − b
=
1 −1
and θ = cos = cos 2
a 8 2 ac 4 4
2
1
8
4 1 1
∴ θ = cos −1 = cos −1 = π
4 2 2 4
t
1 1 1
Complementary function: Yt = [Acos πt + Bsin πt ]
8 4 4
For a particular solution, try Yt = D.
1 1 5
From (∆), D – D+ D = 20 ∴ D = 20 ∴ D = 32
2 8 8
t
1 1 1
General solution: Yt = PS + CF, i.e., Yt = 32 + [Acos πt + Bsin πt ]
8 4 4
Y0 = 33 ∴ 32 + A = 33 ∴ A = 1
1 1 1
Y1 = 32.5 ∴ 32 + [cos π + Bsin π ] = 32.5
8 4 4
1
1 B 1
∴ + =
2 2 2 2 2
1 1 1
∴ + B=
4 4 2
∴ 1+B=2
∴ B=1
t
1 1 1
Hence, the complete solution to (∆) is Yt = 32 + [cos πt + sin πt ]
8 4 4
Page 31 of 36
Mathematics 2 : Difference Equations
4. (Solution 1)
7−λ 9
A – λI = 0 ⇒ = 0 ⇒ (7 – λ)(–3 – λ) + 9 = 0 ⇒ λ2 – 4λ – 12 = 0
−1 −3−λ
⇒ (λ – 6)(λ + 2) = 0 ⇒ λ = 6 or λ = –2
9 9 x 0 9 x + 9 y = 0 1
λ = –2: = , so , so x + y = 0 with eigenvector
− 1 − 1 y 0 − x− y = 0 − 1
1 9 x 0 x + 9y = 0 − 9
λ = 6: = , so , so x + 9y = 0 with eigenvector
−1 − 9 y 0 − x − 9 y = 0 1
−9 1 6 0 –1 1 − 1 − 1 1 1 1
P–1AP = D, where P = , D = , P = = –
1 − 1 0 − 2 8 −1 − 9 8 1 9
xt xt − 1
= A
yt yt − 1
xt wt
Let sequences wt and zt be defined by = P ………………………. (1)
yt zt
wt xt w0 x 1 1 1 5 − 1
(1) ⇒ = P–1 , so = P–1 0 = – =
zt yt z0 y0 8 1 9 3 − 4
wt xt − 1 w w w
P = A = AP t − 1 , so P–1P t = P–1AP t − 1
zt − 1 zt − 1
zt yt − 1 zt
wt wt − 1 wt wt − 1
So, I = D , so
= D
zt zt − 1 zt zt − 1
wt 6 0 wt − 1 6wt − 1
So = =
zt 0 − 2 zt − 1 − 2 zt − 1
So, wt = 6wt – 1 and zt = –2zt – 1 (geometric sequences with r = 6 and r = –2)
So, wt = w0(6)t and zt = z0(–2)t
So, wt = –(6)t and zt = –4(–2)t
Page 32 of 36
Mathematics 2 : Difference Equations
4. (Solution 2)
7−λ 9
A – λI = 0 ⇒ = 0 ⇒ (7 – λ)(–3 – λ) + 9 = 0 ⇒ λ2 – 4λ – 12 = 0
−1 −3−λ
⇒ (λ – 6)(λ + 2) = 0 ⇒ λ = 6 or λ = –2
9 9 x 0 9 x + 9 y = 0 1
λ = –2: = , so , so x + y = 0 with eigenvector
− 1 − 1 y 0 − x− y = 0 − 1
1 9 x 0 x + 9y = 0 − 9
λ = 6: = , so , so x + 9y = 0 with eigenvector
−1 − 9 y 0 − x − 9 y = 0 1
−9 1 6 0 –1 1 − 1 − 1 1 1 1
P–1AP = D, where P = , D = , P = = –
1 − 1 0 − 2 8 −1 − 9 8 1 9
xt xt − 1
In matrix form, the given system is = A
yt yt − 1
x1 x0 x2 x1 x0 x3 x2 x0
So, = A and = A = A2 and = A = A3
y1 y0 y2 y1 y0 y3 y2 y0
xt x0 x0 1 − 9 1 (6 ) t 0 1 1 5
So, = At = PD tP–1 = –
yt y0 y0 8 1 − 1 0 (−2)t 1 9 3
1 − 9( 6) t (−2) t 8
=–
8 ( 6) t
− (−2) t 32
− 9( 6) t (−2)t − 1
=
( 6)
t
− (−2) t − 4
9(6)t − 4(−2)t
=
t
− ( 6) t
+ 4( −2)
Hence, xt = 9(6)t – 4(–2)t and yt = –(6)t + 4(–2)t
************************************************************
Page 33 of 36
Mathematics 2 : Difference Equations
1
⇒ yt = (xt + 1 – 7xt) …………………………. (4) , replacing t by t + 1
9
1 3
(xt + 1 – 7xt) = –xt – 1 – (xt – 7xt – 1) , putting (3) and (4) into (2)
9 9
1
= [8(–2)t + 54(6)t + 28(–2)t – 63(6)t]
9
∴ yt = –(6)t + 4(–2)t
Hence, xt = –4(–2)t + 9(6)t and yt = –(6)t + 4(–2)t
************************************************************
Page 34 of 36
Mathematics 2 : Difference Equations
c−q
6. (a) q = qS(p) = bp – a, q = qD(p) = c – dp ∴ dp = c – q ∴ pD(q) =
d
(b) The time-independent equilibrium occurs when
a+c
qS = qD ∴ bp – a = c – dp ∴ bp + dp = a + c ∴ p(b + d) = a + c ∴ p* =
b+d
a+c b( a + c ) − a ( b + d ) bc − ad
∴ q* = bp* – a = b –a= =
b+d b+d b+d
c − qt
(c) pt = ……………………….. (1) , since pt = pD(qt)
d
qt = bpt – 1 – a ……………………… (2) , since qt = qS(pt – 1)
c − bpt − 1 + a
∴ pt = , putting (2) into (1)
d
b a+c
∴ pt = – pt – 1 + ……………… (3)
d d
t
a+c a+c b b
(d) pt = + p0 − − , from (b) and (c). b, d > 0 ∴ – <0
b+d b+d d d
b
If –1 < – < 0 (i.e. b < d) then pt → p* as t → ∞, oscillating with decreasing magnitude
d
b
If – = –1 (i.e. b = d) then pt oscillates uniformly about p*
d
b
If – < –1 (i.e. b > d) then pt → ±∞ as t → ∞, oscillating with increasing magnitude
d
Page 35 of 36
Mathematics 2 : Difference Equations
9
∴ 6B + C(4)t = 42 + 27(4)t
4
Equating coefficients,
9
(4)t terms: C = 27 ∴ C = 12
4
Constant terms: 6B = 42 ∴ B = 7
Particular solution: yt = 7 + 12(4)t
General solution: yt = PS + CF
∴ yt = 7 + 12(4)t + A(–5)t ……………….. (GS)
y0 = 20, so 7 + 12 + A = 20, so A = 1
Hence, the complete solution to (∆) is yt = 7 + 12(4)t + (–5)t
*******************************************************************
Page 36 of 36