School of Economics

ECON6004: Mathematical Economics

Lecture 1.1: Numbers, Sets, and Functions

Instructor: William Schworm Semester 1, 2017

1. Introduction

Much of mathematics is concerned with the properties of numbers, sets, and functions and the relationships among them. We begin with
an introduction to each of these concepts.
We start with a brief overview of the real numbers and mention a few of their basic properties.
We introduce the concepts of sets and functions in a general setting without extra assumptions. We discuss basic properties that exist
independently of any particular mathematical setting. We will return to these ideas later in the context of vector spaces where additional
properties, operations and relations can be defined.

2. Numbers

I will give a cursory introduction to the real number system.

The general goal in designing a number system is to specify numbers that enable us to represent the answer to certain mathematical
problems. For example, if we select any two numbers, we would like to be able to perform algebraic operations such as addition and
multiplication and have the result be a number also. Also, we would like to be able to order pairs of numbers with the usual inequalities
of “less than” or “greater than” as in x ≥ y or y ≥ x.
PDF version of lecture-01.1.tex produced on 23 February 2017.
Lecture 1.1: Numbers, Sets, and Functions Page 2
The numbers we typically use to count are the natural numbers which are denoted by N = { 1, 2, 3, 4, . . . } where the ellipses “. . .”
mean “and so on in the obvious fashion”. If you add or multiply any two elements of N, you obtain an element of N so that N is closed
under addition and multiplication. Also, for any pair of positive integers x ∈ N and y ∈ N, we have either x ≥ y or y ≥ x or both.
If we consider subtraction on N, then we have the problem that for x, y ∈ N, we will have x − y 6∈ N or y − x 6∈ N or both. To resolve
this difficulty, we extend the numbers to include the negative numbers and zero.
The integers are the numbers
Z = { . . . , −3, −2, −1, 0, 1, 2, 3, . . . } . (1)

The integers are closed under addition, subtraction, and multiplication but not division. There are two distinct problems with division.
First, if i = 0, then j/i is not well-defined for any j ∈ Z. Second, if i, j ∈ Z and i 6= 0, then j/i may or may not be an element of Z.
For example 4/2 ∈ Z but 3/2 6= Z. We solve the second problem by extending the integers to include the rational numbers. The first
problem is handled by defining division j/i only for i 6= 0.
The rational numbers, denoted Q are all numbers that can be represented by i/j with i ∈ Z and j ∈ Z. The rational numbers are
closed under addition, subtraction, multiplication, and division (with the denominator not zero). Also, for any rational numbers r, s ∈ Z
either r ≥ s or s ≥ r or both.
√
Additional operations may required more numbers. For example, 2 is not a rational number since it cannot be expressed as a ratio of
√
two integers. However, 2 (and other irrational numbers) shows up naturally as the solution to natural problems. For example, consider
the following right-angle triangle with the legs (the two sides forming the right angle) having length a and b.

Figure 1: The Length of the Hypotenuse of a Right-Angled Triangle.

h
b

a
Lecture 1.1: Numbers, Sets, and Functions Page 3
The Pythagorean Theorem states that the length of the hypotenuse h satisfies

h2 = a2 + b2 (2)

√
If we choose the triangle with a = b = 1, then h2 = 2 or h = 2. Therefore, the length of the hypotenuse of this triangle is not a rational
number.
This is one of many examples with solutions that are not rational numbers. If we restricted ourselves to rational numbers, then these
problems would have no solutions. The extension is to include the irrational numbers with the rationals. There are a variety of ways
to define the irrationals and I will not present any of these here. The general idea is that we need to “complete” the rationals by adding
the “irrationals” which are intermingled with the rational numbers but distinct from them.
The set of all rational and irrational numbers are the real numbers represented by the real line denoted R. The real numbers are closed
under addition, subtraction, multiplication and division (with a non-zero denominator). Also, for x, y ∈ R, either x ≤ y or y ≤ x or both.
In addition, the lengths of all lines are well-defined.
For any two real numbers x, y ∈ R with x 6= y, consider all numbers z ∈ R such that x < z < y. Among the numbers z satisfying this
property are an infinite number or rationals and an infinite number of irrationals. Also, in a sense that can be well-defined, there are
more irrational numbers than rational numbers satisfying this inequality.
The real numbers have many important properties not shared by the rationals or irrationals on their own. We return to these after
introducing sets and functions.
There is an important extension of the real numbers needed to represent the solutions to many ordinary problems. For example, consider
the polynomial equation x2 = −1 and notice that any “solution” must have a square that is negative. But there are no real numbers
with this property. When solutions to such equations are needed, the real number system is extended to include imaginary or complex
numbers. While this may sound esoteric, complex numbers are essential for understanding elementary properties of linear functions,
solving polynomial equations, and studying oscillatory behaviour of difference or differential equations.
 Lecture 1.1: Numbers, Sets, and Functions Page 4
3. Sets

A set is a collection of basic objects to be studied called the elements of the set. The specification of the elements in a mathematical
analysis is a key choice of the researcher and should be determined by analytical usefulness.
The collection of all elements to be studied is the universal set, denoted U with elements x ∈ U. Then, we will study various subsets
that may contain only some of the elements of U.
Sets may be denoted by enumeration such as a set { 1, 2, 3, 4, 5 } consisting of the first 5 positive integers. An alternative is to define a
set by implicit enumeration such as { 1, 2, 3, 4, 5, . . . } where the dots should be read to mean “and so on”. In this case, the set can be
inferred to be the positive integers
Listing the elements of a set implicitly may be ambiguous and explicit listing may be cumbersome or impossible in the case of sets with
an infinite number of elements. To enable the specification of sets in general circumstances, we introduce a useful notation. Let P(x)
mean that the element x ∈ U has the property P . Then, we define the set of elements with the property P as follows:

S = { x ∈ U | P (x) } (3)

which means that x ∈ S if and only if P (x).

,→ Examples: (Sets)

(i) the set of people in a room can be expressed as { Alvin, Jane, David, . . . , Zelda }.
(ii) the set of birthdays of people in a room.
(iii) the set of positive integers N = { 1, 2, 3, . . . }.
(iv) the set of all integers Z = { . . . , −3, −2, −1, 0, 1, 2, 3, . . . }.
(v) the set of even integers { 2n | n ∈ N }.
(vi) an interval in R such as { x ∈ R | 0 < x < 1 }.
(vii) a subset of Rn such as x ∈ Rn | 0 < ni=1 xi ≤ 1 .
 P
Lecture 1.1: Numbers, Sets, and Functions Page 5
(viii) the set of all continuous real-valued functions on the interval [0, 1].

♦ ♦ ♦

There are a few simple properties of sets that are worth emphasis. First, the order in which elements are listed in a set is irrelevant so
that if S1 = { 1, 2 } and S2 = { 2, 1 }, then S1 = S2 . Second, elements of a set cannot appear multiple times so that if S1 = { 1, 2, 3 } and
S2 = { 2, 3, 4 }, then S1 ∪ S2 = { 1, 2, 3, 4 } (rather than { 1, 2, 2, 3, 3, 4 }). Finally, there is an empty set, denoted ∅, which contains no
elements so that ∅ = { }.

3.1. Relations among Sets

A subset is obtained from any set by excluding some of its elements. We formalise this simple idea with the following definition: a set S1
is a subset of a set S2 if
x ∈ S1 =⇒ x ∈ S2 . (4)

We denote this by S1 ⊂ S2 .
The empty set is a subset of any set. Also, the initial set is treated as a subset of itself.
If two sets have the same elements, we say they are equal. Formally, two sets S1 and S2 are equal if S1 ⊂ S2 and S2 ⊂ S1 . This is
denoted by S1 = S2 .
Two sets S1 and S2 with no elements in common are disjoint. Formally, S1 and S2 are disjoint if

(x ∈ S1 =⇒ x 6∈ S2 ) or, equivalently, (x ∈ S2 =⇒ x 6∈ S1 ). (5)

The remaining alternative is that two sets share some elements but neither is a subset of the other. Two sets S1 and S2 overlap if neither
set is a subset of the other and they are not disjoint.
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3.2. Operations on Sets

We define five operations on sets: intersection, union, difference, complement, and product.
Let U be the universal set with subsets S1 , S2 , and S.
The intersection of S1 and S2 , denoted S1 ∩ S2 , is the set of elements x with x ∈ S1 and x ∈ S2 .
The union of S1 and S2 , denoted S1 ∪ S2 , is the set of elements x with x ∈ S1 or x ∈ S2 .
For two sets S1 and S2 , S1 minus S2 , denoted S1 −S2 or S1 \S2 , is the set of elements x with x ∈ S1 and x 6∈ S2 . Note that S1 −S2 6= S2 −S1
except in trivial circumstances.
The complement of a set S, denoted S c , is the set of points x ∈ U that are not in S. This can be expressed as U − S.
The product of S1 and S2 , denoted S1 × S2 , is the set of ordered pairs (s1 , s2 ) for all s1 ∈ S1 and s2 ∈ S2 .

,→ Examples: Products of Sets

(i) Let S1 = { 1, 2, 3 } and S2 = { 3, 4 }. Then,

S1 × S2 = { (1, 3), (1, 4), (2, 3), (2, 4), (3, 3), (3, 4) } . (6)

(ii) Let the set Y contain the years from 1950 until 2015. Let the set M contain an integer index of the months: 1, 2, . . . , 12. Let
D contain an integer index of the possible days in a month: 1, 2, . . . , 31. The product of these sets in one particular order is

D × M × Y = { (d, m, y) | 1 ≤ d ≤ 31, 1 ≤ m ≤ 12, 1945 ≤ y ≤ 2015 } (7)

which contains all dates from 1950 until now in the form (day,month,year). Americans express dates as (month, day, year).
Computer programmers like to express dates as (year, month, day). How would you represent the same set of dates in each of
these formats?
(iii) Let I1 = [0, 1] and I2 = (2, 3]. Then,

(x1 , x2 ) ∈ R2 | x1 ∈ [0, 1], x2 ∈ (2, 3] (x1 , x2 ) ∈ R2 | 0 ≤ x1 ≤ 1, 2 < x2 ≤ 3 .

 
I1 × I2 = = (8)
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(iv) The product of the real line with itself defines a two-dimensional set:

R2 = R × R = { (x, y) | x ∈ R, y ∈ R } (9)

and repeating this gives

Rn = R × Rn−1 = R × R × . . . × R = { (x1 , . . . , xn ) | xi ∈ R for all i = 1, . . . , n } . (10)

♦ ♦ ♦

We could consider additional algebraic operations on sets such as addition of elements but for general sets, these operations are not
defined. Consider the examples above and note that addition of elements in a set could be defined in a natural way in some cases but
not others.

4. Functions

Next, we introduce the notion of a function.

Definition: Let X and Y be two sets. Then, f is a function from the domain X to the range Y if for each x ∈ X, there is a unique
y ∈ Y which is assigned by f to x.

Standard notation for a function f with domain X and range Y is f : X → Y or if the function is clear, then x 7→ y.
A function can be represented by a set called the graph of the function.

Definition: The graph G of a function f : X → Y is the set

G = { (x, y) ∈ X × Y | y = f (x), x ∈ X } . (11)

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The graph is the usual picture drawn to represent a function with a domain and range in R.
4.1. Operations on Functions

Since we have no algebraic operations defined on the sets, the usual algebraic operations on functions are not defined. For example, let
f : X → Y and g : X → Y where X and Y are arbitrary sets. Then, the statement f + g has no meaning unless the operation of addition
has been defined on Y .
We can define one operation on sets without any algebraic structure on the domain or range of the function.

Definition: Let f : X → Y and g : Y → Z where X, Y , and Z are sets. Then, the composition of f and g is a mapping h = g◦f : X → Z
defined to have image h(x) = g(f (x)).

There are obvious conformability requirements of the domains and ranges of the functions for the composition of two functions to be
defined. These are satisfied in the special case with both functions mapping the same set into itself. Let f : X → X and g : X → X.
Then, there is a composition of f and g denoted g ◦ f : X → X and the composition of g and f denoted f ◦ g : X → X. Note that these
two compositions generally are different.

,→ Example: Consider two functions f : R → R and g : R → R defined by

f (x) = x2 , g(x) = α + x (12)

for α ∈ R with α 6= 0.
The composition of f with g is given by
f ◦ g(x) = ( α + x )2 (13)
while the composition of g with f is
g ◦ f (x) = α + x2 . (14)
Note that f ◦ g 6= g ◦ f since α 6= 0.
♦♦♦
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4.2. Relations among Functions

We can define equality for functions with the same domain and range.

Definition: Two functions, f : X → Y and g : X → Y , with the same domain and range are equal if f (x) = g(x) for all x ∈ X.

We cannot define inequalities between functions at this stage since there is no order defined on the range Y of the functions.

4.3. Properties of Functions

We introduce two important properties that functions may or may not possess.

Definition: A function f : X → Y is one-to-one or injective if x ∈ X, x0 ∈ X, and x 6= x0 implies f (x) 6= f (x0 ).

A function f : X → Y is onto or surjective if every element y ∈ Y there exists an x ∈ X such that f (x) = y.

,→ Examples:

(i) Let X = [−1, 1], Y = [−2, 2], and f (x) = x. Then, f : X → Y is one-to-one but not onto.
(ii) Let X = [−1, 1], Y = [0, 1], and f (x) = x2 . Then, f : X → Y is onto but not one-to-one.
(iii) Let X = [0, 1], Y = [0, 1], and f (x) = x2 . Then, f : X → Y is one-to-one and onto.
(iv) Let X = [−1, 1], Y = [−1, 1], and f (x) = x2 . Then, f : X → Y is neither one-to-one nor onto.

♦ ♦ ♦
Lecture 1.1: Numbers, Sets, and Functions Page 10
There is insufficient structure on the set X at this point to describe properties of functions such as continuity, monotonicity, or convexity.
To define continuity, we would need some notion of distance on both the domain and the range. To define monotonicity, we would need
an ordering of the elements of both the domain and the range. Convexity would require, in addition to the above, an algebraic structure
that allowed convex combinations of elements in the sets X and Y .

4.4. Inverse Functions

If a function f : X → Y has an inverse function, then the inverse function associates to any y ∈ Y the unique point x ∈ X which f
associates to y ∈ Y .

Definition: Let f : X → Y be a function. The inverse function of f is a function f −1 : Y → X for which x = f −1 (f (x)) for all x ∈ X.

Most functions do not have an inverse but such a function exists in the special circumstances described in the next theorem.

Theorem 1. A function f : X → Y has an inverse function if and only if f is one-to-one and onto.

4.5. Images and Inverse Images

Certain sets can be defined for a function that are useful in describing the properties of the function. We begin with a mapping from sets
in X to sets in Y which are determined by the function f : X → Y .

Definition: Let f : X → Y be a function and let S ⊂ X. The image of S under f is the set

f (S) = { f (x) ∈ Y | x ∈ S } (15)

which is contained in Y .

Similarly, one can use f : X → Y to define a mapping from sets in Y to sets in X.

 Lecture 1.1: Numbers, Sets, and Functions Page 11
Definition: Let f : X → Y be a function and let T ⊂ Y . The inverse image of T is the set

f −1 (T ) = { x ∈ X | f (x) ∈ T } (16)

which is contained in X.

The notation f (S) and f −1 (T ) does not indicate a function on X or Y . The notation f (S) is a set in the range of f while f −1 (T ) is a
set in the domain of the function f .

5 Exercises:

(i) Let f : R2 → R be given by f (x, y) = x2 + y 2 . Find (i) the image of (1, 1), (ii) the inverse image of 2, (iii) the image of the
open ball centred at the origin with radius 1, and (iv) the inverse image of the interval [1, 2].
(ii) Let f : R2 → R2 be given by f (x, y) = x2 + y 2 , x . Find (i) the image of (1, 1), (ii) the inverse image of (2, 1), (iii)

the image of the open ball centred at the origin with radius 1, and (iv) the inverse image of the unit square given by S =
{ (u, v) | 0 ≤ u ≤ 1, 0 ≤ v ≤ 1 } where (u, v) are the coordinates in the range of f .

♣ ♣ ♣

5. Properties of R

The real numbers have the greatest lower bound (GLB) and least upper bound (LUB) properties. The GLB property asserts
that a set of real numbers with an upper bound has a least upper bound. The LUB property asserts that a set of real numbers with a
lower bound has a greatest lower bound.
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To be explicit, let S ⊂ R be a set of real numbers and suppose there exists an upper bound for S denoted by x. Denote the set of
upper bounds by U . Then, a least upper bound is a real number s+ that satisfies the following inequalities:

s ≤ s+ for all s ∈ S
(17)
u ≥ s+ for all u ∈ U.

The LUB property asserts that there exists such a point s+ if S has an upper bound.
The LUB of a set S is denoted by sup S and the GLB is denoted by inf S where sup denoted the supremum and inf denotes the infimum.
Neither the rationals nor the irrationals satisfy these properties and obtaining these properties is an important reason for extending to
the real numbers. However, both the LUB and GLB properties are satisfied by the natural numbers.