Académique Documents
Professionnel Documents
Culture Documents
• Economic Profits
– Accounting profits minus
opportunity cost
– Opportunity cost: forgone benefits
generated by alternative uses of
the capital or labor
The nature of opportunity costs
Example
Suppose you are a full-time student
and your favorite professor offers
you a research assistantship
• What do you gain?
• What do you lose?
• What are the opportunity costs?
Calculation
Operating a self-owned store
P Q
10 ?
20 ?
30 ?
Draw the function in a
Diagram
A non-linear function
• Example
Y = −50 + 100X − 5X 2
X Y
0 ?
10 ?
20 ?
Draw the function in a
Diagram
Slope
• Often times we are interested in how Y
moves as X changes
– Slope
change in Y Δ Y Y2 − Y1
= =
change in X Δ X X2 − X1
dY
= b⋅a⋅X b-1
dX
dY
Exercise I : Y = 3X, find
dX
dY
Exercise II : Y = 2X , find
2
dX
Case 3: Derivatives of
Sums and Differences
Y = g (X ) + h ( X )
dY d g(X) d h(X)
= + = g′(X) + h′(X)
dX dX dX
Y = g (X ) − h (X )
dY d g(X) d h(X)
= − = g′(X) − h′(X)
dX dX dX
dY
Exercise 1 : y = 3X + 4X , find
3 2
dX
dY
Exercise 2 : y = 8X − 9X , find
2
dX
Case 4:
Derivatives of Products
Y = g(X) ⋅ h(X)
dY d g(X) d h(X)
= ⋅ h(X) + g(X) ⋅
dX dX dX
= g′(X) ⋅ h(X) + g(X) ⋅ h′(X)
dY
Exercise : Y = 6X ⋅ (3 − X ), find
2
dX
Case 5: Derivatives of a
function of a function
Y = f (W), W = g(X)
dY dY dW
= ⋅ = f′(W) ⋅ g′(X)
dX dW dX
dY
Exercise : Y = 4W + W , W = 3X , find
3 2
dX
Using Derivatives to Solve
Max. & Min. Problems
• Given a function
Y = −50 + 100X − 5X 2