ECON 6305 – Learning Module 1

Limits, derivatives, sums of series, concavity

• After completing this module, the student will be able to:
Lesson 1:
– Recognize and manipulate arithmetic and geometric sums of
series
– Find limits and compute derivatives of univariate functions

Lesson 2:
– Test functions for monotonicity and apply the inverse function
rule
– Use first and second derivatives to find and classify critical values
of univariate functions including border solutions
– Define and test for concavity and convexity of univariate functions
 Limits

•   iff
for all and any real, positive value of

• In another form

• Useful limits
 Sum of Arithmetic Series

•  

2
 Sum of Arithmetic Series (cont.)

•   • More generally:

• Alternate form:

• Note: sometimes replaces in these equations.

 Sum of Geometric Series

•   is the common ratio

 Sum of Geometric Series (cont.)

•  • If the first term is

• Infinite geometric series

• We will use these to replace a sum with the

arithmetic or geometric series.
 Example: Sum of geometric series

•   • Suppose you put B dollars at the end of every

month into an account which pays a constant r%
interest per month. How much money do you
have after n months?

A geometric series with initial value B and common

factor
 Differentiation

•   • The slope of at is

• The tangent line at is

 Differentiation (cont.)

•   • Example
 Continuity and Differentiability

• •  is continuous at if

exists, and

• is differentiable at if

exists

• All differentiable functions are continuous, but not all continuous

functions are differentiable.

• For example
 Differentiation Rules

•  

• Product Rule

• Quotient Rule
 Differentiation Rules (cont.)

•   • Chain rule

• The more familiar chain rule notation

Self test LM 1.1 Differentiation

 Higher order derivatives

•• The
  second derivative

• Note: the second derivative is the slope of the slope

(tells us how the slope is changing).

• The nth derivative

Self test LM 1.2 Isoquant