Mathematical method for economists (BØK108)

Content

The course is an introduction to mathematical methods applied to economic problems. First, the students will become familiar with a number of different functions, such as linear, quadratic and exponential functions. The students will then learn how to analyze these functions, and not least how to find the extreme points (extrema). This is then linked to economic examples, where the students must, among other things, find cost minimizing quantity, profit maximizing quantity and utility-maximizing quantity. They also learn to optimize functions with two variables and with an additional constraint, which requires knowledge of partial differentiation and classification of stationary points. Series and financial mathematics are the last part of the course, and the students get to know, among other things, the sum sign, series, interest calculation, loans, and annuities.

Learning outcome

Knowledge

Upon completing this course, students will have knowledge of:

• Mathematical methods needed to answer various financial questions
• Basic mathematics such as algebra, fractions, percentages, powers, and systems of equations
• Different functional forms (linear, quadratic, logarithmic, exponential, etc.)
• How functions can be analyzed, including what it means to look at the function's limit values and what you achieve by deriving functions
• Marginal considerations on economic issues
• Functions with several variables, and how to optimize such functions
• The sum sign, sequences, interest rates calculations, different types of loans, present value calculations, and annuities

Skills

Upon completing this course, students will be able to:

• Solve basic mathematical problems
• Calculate different functional forms
• Analyze various functions, including showing asymptotes, zero points, intersections, and derivative functions to find extreme points (extrema) and turning points
• Use marginal considerations to analyze various economic issues and demonstrate, for example, cost optimizing quantity, profit optimizing quantity, and utility-maximizing quantity
• Partially derive functions with several variables, classify stationary points and optimize functions with constraints
• Calculate the sum sign, sequences, interest rates, different types of loans, present values, and annuities in various financial contexts

Required prerequisite knowledge

None

Recommended prerequisites

This course has a pre-course lasting two weeks, organized in the week before the "fadderuke" and during the "fadderuke" week. There is a strong recommendation that anyone needing a refresher in mathematics from high school participate in the preliminary course, and there is an expectation that those without R- or S-mathematics from high school complete the pre-course.

It is a significant advantage to have R- or S-mathematics from high school, but with the pre-course and an extensive guidance program throughout the semester, it is designed so that those with P-mathematics from high school can also complete the subject.

Exam

Coursework requirements

Compulsory assignments

Course teacher(s)

Course teacher:

William Gilje Gjedrem

Course coordinator:

William Gilje Gjedrem

Study Program Director:

Tarjei Mandt Larsen

Method of work

Learning in the course occurs through a combination of lectures, problem-solving seminars, and independent work. There will be five weekly lecture hours. In addition, problem-solving seminars and guidance hours with student assistants are offered at different times during the week. The individual work consists of solving problems from three comprehensive problem sets. Mathematical methods require that the students work extensively with problem-solving to internalize the methods that are taught.

Lecture videos on all the topics in the course will also be made available.

Open for

Course assessment

There must be an early dialogue between the course supervisor, the student union representative and the students. The purpose is feedback from the students for changes and adjustments in the course for the current semester.In addition, a digital subject evaluation must be carried out at least every three years. Its purpose is to gather the students experiences with the course.

Literature