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# Quantitative Techniques

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uts, Pune
First Edition 2013
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uts
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Index
I. Content .................................................................... II
II. List of Tables..................................................... VIII
III. Application ........................................................ 105
IV. Bibliography ...................................................... 110
V. Self Assessment Answers .................................... 113
Book at a Glance
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Contents
Chapter I ....................................................................................................................................................... 1
Matrices and Determinants ......................................................................................................................... 1
Aim ................................................................................................................................................................ 1
Objectives ..................................................................................................................................................... 1
Learning Outcome: ........................................................................................................................................ 1
1.1 Introduction .............................................................................................................................................. 2
1.2 Matrix ....................................................................................................................................................... 2
1.2.1 Matrix definition ...................................................................................................................... 2
1.2.2 Matrix Notation ....................................................................................................................... 2
1.2.3 Matrix Equality ........................................................................................................................ 3
1.3 Types of Matrix ........................................................................................................................................ 3
1.3.1 Row Matrix .............................................................................................................................. 3
1.3.2 Column Matrix ......................................................................................................................... 3
1.3.3 Zero/Null Matrix ...................................................................................................................... 3
1.3.4 Square Matrix .......................................................................................................................... 4
1.3.5 Diagonal Matrix ....................................................................................................................... 4
1.3.6 Unit/Identity Matrix ................................................................................................................. 4
1.3.7 Transpose of a Matrix .............................................................................................................. 4
1.4 Operations on Matrices ............................................................................................................................ 4
1.4.1 Addition of Matrices ................................................................................................................ 4
1.4.1.1 Properties of Matrix Addition ................................................................................... 5
1.4.2 Subtraction of Matrices ............................................................................................................ 5
1.4.3 Multiplication of Matrices ....................................................................................................... 6
1.4.3.1 Multiplication of a Matrix by a Number ................................................................... 6
1.4.3.2 Multiplication of a Matrix by another Matrix ........................................................... 6
1.4.3.3 Properties of Multiplication of Matrices ................................................................... 7
1.5 Determinants ............................................................................................................................................ 7
1.5.1 Calculating Value of 2 x 2 Determinant ................................................................................... 7
1.5.2 Calculating Value of 3 x 3 Determinant ................................................................................... 8
1.5.2.1 Cofactors ................................................................................................................... 8
1.5.2.2 Expansion by Minors ................................................................................................ 8
1.6 Inverse of a Matrix ................................................................................................................................... 9
1.6.1 Finding Inverse for a 2 x 2 Matrix ........................................................................................... 9
1.6.2 Finding Inverse for a 3 x 3 Matrix ........................................................................................... 9
1.7 Solving Simultaneous Equation using Determinants ..............................................................................11
1.7.1 Solving Two Simultaneous Equations ....................................................................................11
1.7.2 Solving Three simultaneous Equations .................................................................................. 12
1.8 Properties of Determinants .................................................................................................................... 13
1.9 Difference between Matrices and Determinants .................................................................................... 14
Summary ..................................................................................................................................................... 15
References ................................................................................................................................................... 15
Self Assessment ........................................................................................................................................... 16
Chapter II ................................................................................................................................................... 18
Mathematical Logic ................................................................................................................................... 18
Aim .............................................................................................................................................................. 18
Objective ...................................................................................................................................................... 18
Learning outcome ........................................................................................................................................ 18
2.1 Introduction ............................................................................................................................................ 19
2.2 Definition ............................................................................................................................................... 19
2.2.1 Statement ............................................................................................................................... 19
2.2.2 Truth Value ............................................................................................................................. 19
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2.2.3 Truth Table ............................................................................................................................. 19
2.2.4 Compound Statements ........................................................................................................... 19
2.3 Statement ................................................................................................................................................ 20
2.4 Compound Statement ............................................................................................................................. 20
2.5 Connectives ............................................................................................................................................ 21
2.5.1 Negation ................................................................................................................................. 21
2.5.2 Conjunction ............................................................................................................................ 22
2.5.3 Disjunction ............................................................................................................................ 23
2.5.4 Conditional or Implication .................................................................................................... 23
2.5.5 Biconditional or Biimplication .............................................................................................. 24
2.5.6 Contrapositive, Converse and Inverse ................................................................................... 25
2.6 Tautology ,Contradiction and Contingency ........................................................................................... 25
2.7 Laws of Algebra ..................................................................................................................................... 26
2.7.1 Identity Law ........................................................................................................................... 26
2.7.2 Commutative Law .................................................................................................................. 26
2.7.3 Complement Law ................................................................................................................... 26
2.7.4 Double Negation .................................................................................................................... 26
2.7.5 Associative Law ..................................................................................................................... 26
2.7.6 Distributive Law .................................................................................................................... 26
2.7.7 Absorption Law ...................................................................................................................... 26
2.7.8 Demorgans Law .................................................................................................................... 26
2.7.9 Equivalance of Contrapositive ............................................................................................... 27
2.7.10 Others ................................................................................................................................... 27
Summary ..................................................................................................................................................... 28
References ................................................................................................................................................... 28
Self Assessment ........................................................................................................................................... 29
Chapter III .................................................................................................................................................. 31
Set Theory ................................................................................................................................................... 31
Aim .............................................................................................................................................................. 31
Objective ...................................................................................................................................................... 31
Learning outcome ........................................................................................................................................ 31
3.1 Definition of a Set .................................................................................................................................. 32
3.2 Standard Sets .......................................................................................................................................... 32
3.3 Representation of set .............................................................................................................................. 32
3.3.1 Tabular Form/Roaster Method ............................................................................................... 32
3.3.2 Rule Method .......................................................................................................................... 32
3.3.3 Descriptive Form ................................................................................................................... 32
3.4 Types of Sets .......................................................................................................................................... 33
3.4.1 Finite Set ................................................................................................................................ 33
3.4.2 Empty or Null Set .................................................................................................................. 33
3.4.3 Subset ..................................................................................................................................... 33
3.4.3.1 Proper Subset .......................................................................................................... 33
3.4.3.2 Improper Subset ...................................................................................................... 33
3.4.4 Infinite Set .............................................................................................................................. 33
3.4.5 Disjoint Sets ........................................................................................................................... 34
3.4.6 Overlapping Sets .................................................................................................................... 34
3.4.7 Universal Set .......................................................................................................................... 34
3.4.8 Equal Set ................................................................................................................................ 34
3.4.9 Complement Set ..................................................................................................................... 34
3.4.10 Equivalent Set ...................................................................................................................... 34
3.5 Illustration of Various Sets ..................................................................................................................... 35
3.6 Basic Operations on Sets ....................................................................................................................... 35
3.6.1 Intersection of Two Sets ......................................................................................................... 35
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3.6.2 Union of Two Sets ................................................................................................................. 35
3.6.3 Relative Complement or Difference of Two Sets .................................................................. 35
3.6.4 Complement of a Set .............................................................................................................. 36
3.6.5 Symmetric Difference of Two Sets ........................................................................................ 36
3.7 Properties of Set ..................................................................................................................................... 36
3.7.1 Commutative Law .................................................................................................................. 36
3.7.2 Associative Law ..................................................................................................................... 36
3.7.3 Distributive Law .................................................................................................................... 37
3.7.4 Identity Law ........................................................................................................................... 37
3.7.5 Complement Law ................................................................................................................... 37
3.7.6 Idempotent Law ..................................................................................................................... 37
3.7.7 Bound Law ............................................................................................................................. 37
3.7.8 Absorption Law ...................................................................................................................... 37
3.7.9 Involution Law ....................................................................................................................... 37
3.7.10 De Morgans Law ................................................................................................................ 37
3.7.11More Results ......................................................................................................................... 37
Summary ..................................................................................................................................................... 40
References ................................................................................................................................................... 40
Self Assessment ........................................................................................................................................... 41
Chapter IV .................................................................................................................................................. 43
Progression ................................................................................................................................................. 43
Aim .............................................................................................................................................................. 43
Objective ...................................................................................................................................................... 43
Learning outcome ........................................................................................................................................ 43
4.1 Introduction ............................................................................................................................................ 44
4.2 Arithmetic Progression ........................................................................................................................... 44
4.3 Formulae for Arithmetic Progression ..................................................................................................... 45
4.3.1 The general form of an AP .................................................................................................... 45
4.3.2 The n
th
term of an AP ........................................................................................................ 45
4.3.3 Sum of first n terms ( ) of an AP ......................................................................................... 45
4.4 Arithmetic Mean .................................................................................................................................... 45
4.5 Geometric Progression ........................................................................................................................... 45
4.6 Formulae for Geometric Progression ..................................................................................................... 46
4.6.1 The general form of a GP ....................................................................................................... 46
4.6.2 The n
th
term T
n
of a GP ........................................................................................................... 46
4.6.3 The sum of first n terms S
n
of a GP........................................................................................ 46
4.7 Geometric Mean ..................................................................................................................................... 47
4.8 Harmonic Progression ............................................................................................................................ 47
4.9 Formulae for Harmonic Progression ...................................................................................................... 48
4.9.1 The General Form of HP ........................................................................................................ 48
4.9.2 The nth term (T
n
)of a HP........................................................................................................ 48
4.10 Harmonic mean .................................................................................................................................... 48
4.11 Comparison between AP and GP ......................................................................................................... 48
4.12 Important Rules on Arithmetic mean(AM),Geometric Mean (GM) and Harmonic Mean(HM) ......... 49
Summary ..................................................................................................................................................... 51
References ................................................................................................................................................... 51
Self Assessment ........................................................................................................................................... 52
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Chapter V .................................................................................................................................................... 54
Probability .................................................................................................................................................. 54
Aim .............................................................................................................................................................. 54
Objective ...................................................................................................................................................... 54
Learning outcome ........................................................................................................................................ 54
5.1 Introduction ............................................................................................................................................ 55
5.2 Definitions .............................................................................................................................................. 55
5.2.1 Experiment ............................................................................................................................. 55
5.2.2 Deterministic Experiment ...................................................................................................... 55
5.2.3 Random Experiment .............................................................................................................. 55
5.2.3.1 Examples of Performing a Random Experiment .................................................... 55
5.2.3.2 Details ..................................................................................................................... 55
5.2.3.3 Sample Space : ........................................................................................................ 55
5.2.4 Elementary Event ................................................................................................................... 55
5.2.5 Impossible Event .................................................................................................................... 55
5.2.6 Events ..................................................................................................................................... 56
5.2.7 Mutually Exclusive Event ...................................................................................................... 56
5.2.8 Compatibility ......................................................................................................................... 56
5.2.9 Independent Events ................................................................................................................ 56
5.2.10 Dependent Events ................................................................................................................ 56
5.3 Probability .............................................................................................................................................. 56
5.3.1 Probability of Occurrence of an Event .................................................................................. 56
5.3.2 Results on Probability ............................................................................................................ 56
5.3.3 Binomial Distribution ............................................................................................................ 57
5.3.4 Geometric Theorem ............................................................................................................... 57
5.4 Conditional Probability .......................................................................................................................... 57
5.4.1 Conditional probability of Dependent Events ....................................................................... 57
5.4.2 Conditional probability of Independent Events ..................................................................... 57
5.5. Multiplication Rule ............................................................................................................................... 57
5.5.1 Independent Events ................................................................................................................ 57
5.5.2 Dependent Events .................................................................................................................. 57
5.6 Steps to Solve Probability ...................................................................................................................... 58
5.7 Bayes Theorem ...................................................................................................................................... 58
Summary ..................................................................................................................................................... 61
References ................................................................................................................................................... 61
Self Assessment ........................................................................................................................................... 62
Chapter VI .................................................................................................................................................. 64
Permutations and Combinations .............................................................................................................. 64
Aim .............................................................................................................................................................. 64
Objective ...................................................................................................................................................... 64
Learning outcome ........................................................................................................................................ 64
6.1 Introduction ............................................................................................................................................ 65
6.2 Basic Calculation Used .......................................................................................................................... 65
6.2.1 Factorial Notation ................................................................................................................. 65
6.3 Fundamental Principles of Counting ..................................................................................................... 65
6.3.1 Principle of Addition .............................................................................................................. 65
6.3.2 Principle of Multiplication ..................................................................................................... 65
6.4 Permutation ............................................................................................................................................ 66
6.4.1 Basic Forms of Permutations ................................................................................................. 67
6.4.1.1 All given Objects are Distinct ................................................................................. 67
6.4.1.2 When k cannot be Selected .................................................................................... 67
6.4.1.3 When all the given n objects are not distinct .......................................................... 67
6.4.1.4 Circular Permutation .............................................................................................. 67
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6.4.1.5 Repetition is Allowed .............................................................................................. 68
6.5 Combination ........................................................................................................................................... 68
6.6 Basic Forms of Combination ................................................................................................................. 68
6.6.1All Given Objects are distinct ................................................................................................ 68
6.6.2 When K objects cannot be selected ....................................................................................... 68
6.6.3 When k Objects are always Selected .................................................................................... 69
6.6.4 Distribution of Objects into two Groups ................................................................................ 69
6.6.5 Distribution of Similar Objects .............................................................................................. 69
6.6.6 Total possible Combination of n Distinct Objects ................................................................ 69
6.6.7 When All are not Distinct Objects ......................................................................................... 70
6.6.8 When all are Distinct but of Different Kind .......................................................................... 70
6.7 Special Case(Permutation and Combination Simultaneously) .............................................................. 70
6.8 Basic Manipulation on Permutation and Combinations ........................................................................ 70
Summary ..................................................................................................................................................... 73
References ................................................................................................................................................... 73
Self Assessment ........................................................................................................................................... 74
Chapter VII ................................................................................................................................................ 76
Interpolation ............................................................................................................................................... 76
Aim .............................................................................................................................................................. 76
Objectives .................................................................................................................................................... 76
Learning outcome ........................................................................................................................................ 76
7.1 Introduction ............................................................................................................................................ 77
7.2 Definition of Interpolation ..................................................................................................................... 77
7.3 Application ............................................................................................................................................. 77
7.4 Need and Importance of Interpolation ................................................................................................... 77
7.5 Methods of Interpolation ........................................................................................................................ 78
7.5.1 Graphical Method .................................................................................................................. 78
7.5.2 Newtons method of advancing differences ........................................................................... 78
7.5.3 Lagranges Method................................................................................................................. 78
7.5.4 Newton-Gauss Forward Method ............................................................................................ 78
7.5.5 Newton-Gauss Backward Method ......................................................................................... 79
Summary ..................................................................................................................................................... 80
References ................................................................................................................................................... 80
Self Assessment ........................................................................................................................................... 81
Chapter VIII ............................................................................................................................................... 83
Consumer Arithmetic ................................................................................................................................ 83
Aim .............................................................................................................................................................. 83
Objectives .................................................................................................................................................... 83
Learning outcome ........................................................................................................................................ 83
8.1 Introduction: Profit and Loss ................................................................................................................. 84
8.1.1 Formulae ................................................................................................................................ 84
8.2 Interest .................................................................................................................................................... 85
8.2.1 Terms Used ............................................................................................................................ 85
8.2.2 Simple Interest ....................................................................................................................... 85
8.2.2.1 Formulae ................................................................................................................. 85
8.2.3 Recurring Deposit .................................................................................................................. 86
8.2.3.1 Formulae ................................................................................................................. 86
8.2.4 Compound Interest ................................................................................................................. 86
8.2.4.1 Formulae ................................................................................................................. 86
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Summary ..................................................................................................................................................... 89
References ................................................................................................................................................... 89
Self Assessment .......................................................................................................................................... 90
Chapter IX .................................................................................................................................................. 92
Relations and Functions ............................................................................................................................ 92
Aim .............................................................................................................................................................. 92
Objectives .................................................................................................................................................... 92
Learning outcome ........................................................................................................................................ 92
9.1 Relation .................................................................................................................................................. 93
9.2 Domain and Range of a Relation ........................................................................................................... 93
9.3 Functions ................................................................................................................................................ 93
9.3.1 Range, image, co-domain ...................................................................................................... 94
9.4 Break Even Analysis .............................................................................................................................. 94
Summary ..................................................................................................................................................... 95
References ................................................................................................................................................... 95
Self Assessment ........................................................................................................................................... 96
Chapter X .................................................................................................................................................. 98
Statistics ...................................................................................................................................................... 98
Aim .............................................................................................................................................................. 98
Objectives .................................................................................................................................................... 98
Learning outcome ........................................................................................................................................ 98
10.1 Introduction .......................................................................................................................................... 99
10.2 Definition of Statistics ......................................................................................................................... 99
10.3 Scope and Applications of Statistics .................................................................................................... 99
10.4 Characteristics of Statistics .................................................................................................................. 99
10.5 Functions of Statistics ........................................................................................................................ 100
10.6 Limitations of Statistics ..................................................................................................................... 100
10.7 Classification ...................................................................................................................................... 100
10.8 Objectives of Classification ............................................................................................................... 100
10.9 Characteristics of Classification ........................................................................................................ 100
10.10 Frequency Distribution .................................................................................................................... 101
10.10.1 Discrete or Ungrouped Frequency Distribution ............................................................... 101
10.10.2 Continuous or Grouped Frequency Distribution ............................................................. 101
10.10.3 Cumulative Frequency Distribution ................................................................................. 101
Summary ................................................................................................................................................... 102
References ................................................................................................................................................. 102
Self Assessment ......................................................................................................................................... 103
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List of Tables
Table 1.1 Differences between matrices and determinants .......................................................................... 14
Table 2.1 Symbols of connectives ............................................................................................................... 21
Table 2.2 Truth Table of Negation ............................................................................................................... 22
Table 2.3 Truth table of conjunction ............................................................................................................ 22
Table 2.4 Truth table for disjunction ............................................................................................................ 23
Table 2.5 Truth table for implication ........................................................................................................... 24
Table 2.6 Truth table of biimplication .......................................................................................................... 24
Table 2.7 P P is a tautology .................................................................................................................... 25
Table 2.9 contingency .................................................................................................................................. 25
Table 4.1 Comparison between AP and GP ................................................................................................. 48
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Chapter I
Matrices and Determinants
Aim
The aim of this chapter is to:
introduce the concept of matrices
elucidate the types of matrix
introduce determinant of matrix
Objectives
The objective of this chapter is to:
explicate the operations on matrices
describe the properties of determinants
explicate the properties of matrices
Learning Outcome
At the end of this chapter, you will be able to:
compare different types of matrix
identify the basic operations on matrix
understan d simultaneous linear equations using determinants
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1.1 Introduction
The study of matrices and determinants is of immense signifcance in the feld of business and economics. This
lesson introduces the matrix, the rectangular array and determinants at the heart of matrix algebra. Matrix algebra
is used quite a bit in advanced statistics, largely because it provides two benefts.
Compact notation for describing sets of data and sets of equations.
Effcient methods for manipulating sets of data and solving sets of equations.
1.2 Matrix
1.2.1 Matrix defnition
A matrix is a rectangular array of numbers arranged in rows and columns. It is a collection of real or complex
numbers (usually real) arranged in a fxed number of rows and columns. It is arranged in a rectangular brackets
(either ( ) or [ ]).A set of real or complex numbers arranged in a rectangular array of m rows and n columns, of
an order m x n (read as m by n) is called a matrix. The dimension or order of matrix is written as number of rows
x number of columns.
A=
Example: A=
The topmost row is row 1.The leftmost column is column 1.
Here, the number of rows (m) is 2 and the number of columns (n) is 3.
So the matrix is of order 2 x 3 (2 by 3 matrix).
Matrices are used to solve problem in:
Electronics
Statics
Robotics
Linear programming
Optimisation
Intersection of planes
Genetics
1.2.2 Matrix Notation
Statisticians use symbols to identify matrix elements and matrices.
Matrix elements: Consider the matrix below, in which matrix elements are represented entirely by symbols.
A=
By convention the frst subscript refers to the row number and the second subscript refers to the column number
.Thus the frst element in the frst row is represented by ,the second element in the frst row, by and so
on, until we reach the fourth element in second row which is represented by .
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Notation: The simplest way to represent a matrix symbolically is to use bold face letters A,B ,C etcThus A
might refer to a 2 x 3 matrix in the below example
A =
Another approach of representing matrix A is:
A= [ ] where i=1, 2 and j=1, 2, 3, 4
This notation indicates A is a matrix with two rows and four columns. The actual element of the array are not
displayed they are represented by the symbol .
1.2.3 Matrix Equality
To understand matrix algebra, we need to understand matrix equality. Two matrices are equal if all three of the
following conditions are met:
each matrix has same number of rows
each matrix has same number of columns
corresponding elements within each matrix are equal
Consider the three matrices given below

A= B= C=
If A=B, then x=22 and y=33, as corresponding elements of equal matrices are equal. And it is clear that C is not
equal to A or B, because C has more columns than A or B.
1.3 Types of Matrix
There are six types of matrices. They are as follows.
1.3.1 Row Matrix
A matrix having a single row is called row matrix.
Example
A=
1.3.2 Column Matrix
A matrix having a single column is called column matrix.
Example:
A=
1.3.3 Zero/Null Matrix
A matrix having each and every element as zero is called a null or zero matrix.
Example
A=

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1.3.4 Square Matrix
A matrix having equal number of rows and columns is called a square matrix.
Example
A=
1.3.5 Diagonal Matrix
A square matrix having all elements zero except principal diagonal elements is called diagonal matrix. Principal
diagonal elements can be any non-zero elements.
Matrix elements like , , etc are called principal diagonal elements.
Example
A=
1.3.6 Unit/Identity Matrix
A square matrix which is a diagonal matrix having all principal diagonal elements as one (unit) is called identity
matrix.
Example
A=

1.3.7 Transpose of a Matrix
The transpose of one matrix is obtained by using the row of the frst matrix as the column of the second matrix.
Example: if A= , then the transpose of A is represented by A
A=
1.4 Operations on Matrices
Like ordinary algebra, matrix algebra has operations addition, subtraction and multiplication.
Two matrices can be added only if they have same dimensions; that is, they must have same number of rows and
columns.
For example, consider matrix A and matrix B
A= B=

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Both matrices have the same number of rows and columns (2 rows and 3 columns), so they can be added. Thus,
A+B =
A+B=
And fnally, note that the order in which the matrices are added does not affect the fnal result.A+B=B+A.
The properties of addition of matrices are as follows:
Commutative property is true ;that is A+B=B+A
Associative property is true
A+ (B+C) = (A+B) +C
Distributive property is true
K (A+B) =ka+kb
(A+B) k=Ak+Bk
Existence of additive identity element, if a matrix is added with null matrix of the same dimension then, it results
in the same matrix, so the additive identity of a matrix is null matrix
A+0=0+A=A
Existence of additive inverse, if a matrix is added by inverse of A matrix, then the result is a null matrix, so the
additive inverse of a matrix is the inverse of the matrix itself matrix
A+ (-A) = (-A) +A= 0
1.4.2 Subtraction of Matrices
Like addition of matrices, subtraction of matrices also follows the same conditions and procedures for subtracting
two matrices. Two matrices can be subtracted only if they have same dimensions; that is, they must have same
number of rows and columns.
Subtraction can be accomplished by adding corresponding elements.
For example, consider matrix A and matrix B
A= B=
Both matrices have the same number of rows and columns (3 rows and 2 columns), so they can be subtracted.
Thus,
A-B=
A-B=
And fnally, note that the order in which the matrices are subtracted affects the fnal result. A-B B-A.
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1.4.3 Multiplication of Matrices
In matrix multiplication there are two types of matrix multiplication. They are:
Multiplication of a matrix by a number
Multiplication of a matrix by another matrix
1.4.3.1 Multiplication of a Matrix by a Number
When a matrix is multiplied by a number, every element in the matrix should be multiplied by that same number.
This operation produces a new matrix, which is called scalar multiple. This multiplication process is called as scalar
multiplication.
For example, if x is 5 and matrix A is as follows,
A=
Then,
xA = 5A = 5 = = = B (say)
In the example above, every element of A is multiplied by 5 to produce the scalar multiple, B.
1.4.3.2 Multiplication of a Matrix by another Matrix
The matrix product AB is defned only when the number of columns in A is equal to the number of rows in B .Similarly,
the matrix product BA is defned only when the number of columns in B is equal to number of rows in A.
Suppose that A is an i x j matrix and B is a j x k matrix. Then, the matrix product AB results in a matrix C which
has i rows and k columns; and each element in C can be computed according to the following formula.
=
Where,
= the element in row i and column k in matrix C
= the element in row i and column j in matrix A
= the element in row j and column k in matrix B
= summation sign, which indicates that the should be summed over j
Suppose we want to compute AB, given the matrices below.
A= B=
Let AB = C.Because A has 2 rows, we know that C will also have 2 rows; and because B has 2 columns, we know
that C will have 2 columns. To compute the value of every element in 2 x 2 matrix C, we use the formula
= , such that

= = 0 * 6 + 1 * 8 + 2 * 1 = 0+8+2 = 10

= = 0 * 7 + 1 * 9 + 2 * 2 = 0+9+4 = 13
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= = 3 * 6 + 4 * 8 + 5 * 1 = 18+32+5 = 55

= = 3 * 7 + 4 * 9 + 5 * 2 = 21+36+10 = 67
Therefore AB= C =
1.4.3.3 Properties of Multiplication of Matrices
The properties of multiplication of matrices are as follows:
Commutative property is not true ;that is ,even when matrix multiplication is possible in both direction the
results may be different ,that is AB is not always equal to BA
Associative property is true
A (BC) = (AB) C
Distributive property is true
K (AB) = (ka) (kb)
(AB) k= (Ak) (Bk)
Existence of multiplicative identity element, if a matrix is multiplied with identity matrix of the same dimension
then, it results in the same matrix, so the multiplicative identity of a matrix is identity matrix
AI=IA=A
Existence of multiplicative inverse, if a matrix is multiplied by the inverse of it, then the result is a identity
matrix, so the multiplicative inverse of a matrix is its inverse matrix (inverse of a matrix is discussed in 1.6)
A * = * A = I
1.5 Determinants
A determinant is a square array of numbers (written within a pair of vertical lines) which represents a certain sum
of products.
example of a 2 x 2 determinant:
A=
1.5.1 Calculating Value of 2 x 2 Determinant
In general we need to fnd the value of 2 x 2 determinants with elements a, b, c and d as follows:
Here the diagonals are multiplied (top left * bottom right frst) and then subtracted.
Example
Find the value of the determinant
= 4 * 3 - 2 * 1
= 12 2
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1.5.2 Calculating Value of 3 x 3 Determinant
A general representation of a 3 x 3 matrix is as follows
A=
The method used for fnding the determinants of 3 x 3 is the expansion by minors.
1.5.2.1 Cofactors
The 2 x 2 determinant is called the cofactor of for 3 x 3 matrix
The cofactors are formed from the elements that are not in the same row and not in the same column as .
Thus the elements in grey are not in the row and column of , so is the cofactor of .
Similarly for , the cofactor is
And for , the cofactor is
1.5.2.2 Expansion by Minors
The 3 x 3 determinant values are evaluated by expansion by minors. This involves multiplying the frst column of the
determinant with the cofactor of those elements. The middle product is subtracted and the fnal product is added.
= - +
example: evaluate

= -2 (5) + 4

= -2[(-1) (2)-(-8) (4)] 5 [(2) (3) (-8) (-1)] + 4 [(3) (4)-(-1) (-1)]
= -2(30)-5(-2) +4(11)
=-60+10+44
= -6
Here we are using frst column to expand it, even if we use frst row to expand, it gives the same result.
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1.6 Inverse of a Matrix
Suppose A is an n x n matrix, denoted by , that satisfes the following condition
A = A = I
Where I is the identity matrix
To check whether inverse of the matrix exists:
Find the determinant of the square matrix, if the determinant value is zero then the inverse of that matrix does not
exist and that matrix is known as Singular matrix.
If the determinant value is not zero, then there exists an inverse for that matrix.
The matrix for which there is an inverse is called non-singular matrix or invertible matrix.
1.6.1 Finding Inverse for a 2 x 2 Matrix
Suppose A is a non-singular 2 x 2 matrix .Then, the inverse of A can be computed as given below,
A= then = |A| is the determinant value of the matrix
How to fnd the determinant value of 2 x 2 matrix and 3 x 3 matrix are discussed above in 1.5.1 and 1.5.2
respectively.
Example:
Find the inverse of the 2 x 2 matrix B =
|B| = 4 (Refer 1.5.1)
= = is the inverse of the matrix
1.6.2 Finding Inverse for a 3 x 3 Matrix
Steps for fnding the inverse of 3 x 3 matrix:
Find the determinant of a 3 x 3 matrix, det(A)
Find the transpose of the matrix
Find the determinant of the cofactors of each element in the transpose matrix.
Represent these values as a matrix of the cofactors
Substitute the required values in
Verify by multiplying A and ,the result should be an identity matrix of same dimension.
Example
Find the inverse of A=
Step 1:
Find determinant of the 3 x 3 matrix (refer 1.5.2)
det (A) = 1(0-24)-2(0-20)+3(0-5)
det (A)=1
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Step 2:
Find the transpose of the matrix
=
Step 3:
Find the determinant of the cofactor of each element in the transpose matrix.
= = -24
= = -18
= = 5
= = -20
= = -15
= = 4
= = -5
= = -4
= = 1
Step 4:
Represents these values as a matrix of the cofactors
Step 5:
Find the adjoint of the matrix
=
Step 6:
Substitute the values in

=
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Therefore =
Step 7:
Verifcation A = I
=
If a matrix is multiplied with its inverse, then the result should be the identity matrix of same dimension
1.7 Solving Simultaneous Equation using Determinants
1.7.1 Solving Two Simultaneous Equations
System of equation can be solved using determinants with cramers rule
The solution of (x, y) of the system
x + y = ----------- (1)
x + y = ----------- (2)
can be found using determinants
Solution:
Here, x and y are the variables, & are the coeffcients of the variable x in equations 1 and 2 respectively
and & are the coeffcients of the variable y in equations 1 and 2 respectively, and are the constants of
equation 1 and 2 respectively.
Step 1:
Solve the determinant of coeffcients of variables and it is represented by
=
Step 2:
Solve the determinant replacing constants instead of coeffcient of variable x and it is represented by
=
Step 3:
Solve the determinant replacing constants instead of coeffcient of variable y and it is represented by
=
Step 4:
Obtain solution as x= and y =
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Example
Solve the system using Cramers rule.
x-3y=6
2x+3y=3
Solution:
Here = 1; = -3; = 2; = 3; = 6; = 3;
So, x= = = = 3
y= = = = -1
So, the solution is (3,-1)
1.7.2 Solving Three simultaneous Equations
System of equation can be solved using determinants with cramers rule
The solution of (x, y, z) of the system
x + y+ z = ----------- (1)
x + y+ z = ----------- (2)
x + y+ z = ----------- (3)
can be found using determinants
Solution
Here, x, y and z are the variables. , & are the coeffcients of the variable x in equations 1, 2 and 3 respectively
. , & are the coeffcients of the variable y in equations 1, 2 and 3 respectively. , and are the
coeffcients of the variable z in equations 1, 2 and 3 respectively. , and are the constants of equation 1,2
and 3 respectively.
Step 1:
Solve the determinant of coeffcients of variables and it is represented by
=
Step 2:
Solve the determinant replacing constants instead of coeffcient of variable x and it is represented by
=
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Step 3:
Solve the determinant replacing constants instead of coeffcient of variable y and it is represented by
=
Step 4:
Solve the determinant replacing constants instead of coeffcient of variable z and it is represented by
=
Step 5:
Obtain solution as x= ; y = ; z =
Example
Solve the system using Cramers rule.
2x+3y+z=2
-x+2y+3z=1
-3x-3y+z=0
Solution:
Here = 2; = 3; = 1; = -1; = 2; = 3; = -3; =-3; = 1 and =2; = 1; =0
= = 2(11) +1(6)-3(7) = 7
So, x= = = 28 / 7=4
y= = = - 21/ 7 = -3
z= = = 21/ 7 = 3
So, the solution is (4,-3, 3)
1.8 Properties of Determinants
The properties of determinants are as follows:
The value of determinant remains unchanged if its rows and columns are interchanged
If any two rows/columns change by minus sign only ,then also the value of determinant remains unchanged
If any two rows/columns of a determinant are identical, then the value of determinant is zero
If each element of a row/column of a determinant is multiplied by a same constant and then added to corresponding
elements of some other row/column, then the value of determinant remains unchanged.
If each element of a row/column of a determinant is zero, then the value of the determinant is zero.
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1.9 Difference between Matrices and Determinants
Following is the difference between matrices and determinants
Features Matrices Determinants
Defnition A matrix is an array of
numbers arranged in
rectangular brackets.
A determinant is a square array of numbers
(written within a pair of vertical lines) which
represents a certain sum of products.
Representation It is written inside
brackets either ( ) or [ ].
It is written within two vertical Lines | | .
Value/Result It results in an array of
number inside brackets.
It results in a single number.
Infuence Scalar multiplication
affects all the elements in
a matrix.
Scalar multiplication only affects single row /
single column.
Value Matrices contain many
elements.
Determinant has a single number as a end
result.
Nature Matrices may positive or
negative.
Determinant value is always positive. Though
it results in a negative number we consider it as
positive because determinant is like distance(it
cannot e negative whether it is forward or
backward)
Table 1.1 Differences between matrices and determinants
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Summary
A matrix is a rectangular array of numbers arranged in rows and columns.
A set of real or complex numbers arranged in a rectangular array of m rows and n columns, of an order m x
n (read as m by n) is called a matrix.
Two matrices can be added only if they have same dimensions.
Commutative property, Associative property, Distributive property is true for matrix addition.
The matrix product AB is defned only when the number of columns in A is equal to the number of rows in B.
Commutative property is not true for matrix multiplication.
Associative property ,Distributive property are true for matrix multiplication
There exists additive identity, multiplicative identity, additive inverse and multiplicative inverse for a matrix.
A determinant is a square array of numbers.
The 3 x 3 determinant values are evaluated by expansion by minors.
System of equation can be solved using determinants with Cramers rule.
References
Dr. Kala, V. N. & Rana, R., 2009. Matrices, 1st ed., Laxmi Publication ltd.
Jain, T. R. & Aggarwal, S. C., 2010. Business Mathematics and Statistics, V.K Enterprises.
Matrices and determinants , [pdf] Available at: < http://www.kkuniyuk.com/M1410801Part1.pdf > [Accessed
31 August 2012].
Gunawarden, J., Matrix algebras for beginning, [Online] Available at: < http://vcp.med.harvard.edu/papers/
matrices-1.pdf > [Accessed 31 August 2012].
2011, Matrices, [Video Online] Available at: < http://www.youtube.com/watch?v=9tFhs-D47Ik > [Accessed
31 August 2012].
Hurst, W., Matrices & determinants, [Video Online] Available at: < http://www.youtube.com/watch?v=havr-
W8IwKs > [Accessed 31 August 2012].
McMahon, D., 2005. Linear Algebra Demystifed, McGraw-hill publication.
Anton, H., 2010. Elementary Linear Algebra, 10th ed., FM Publications.
Greub, W., 1975. Linear Algebra graduate texts in mathematics, Springer.

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Self Assessment
If matrix A= 1.

and aij is the element of matrix A in i
th
row and j
th
column, then what is the value of a
21
?

3 a.
4 b.
2 c.
5 d.
It is given that P= 2. and Q = .What is the value of x+y if P=Q?
3 a.
5 b.
6 c.
8 d.
A _ 3. ______ is a rectangular array of numbers arranged in rows and columns.
Determinant a.
Matrix b.
Array c.
Transpose d.
Two matrices can be added only if they have __________. 4.
same dimensions a.
different dimensions b.
plus sign c.
minus sign d.
When a matrix is multiplied by a number, then the process is called as _________. 5.
matrix multiplication a.
scalar multiplication b.
square multiplication c.
rectangular multiplication d.
What type of matrix is A= 6. ?
square a.
diagonal b.
null c.
identity d.
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What is the addition matrix of the following two matrices? 7.
A = and B=
a.

b.

c.

d.

If A = 8. , what is the value of 5A?
a.

b.

c.

d.

What is the value of determinant 9. ?
6 a.
8 b.
7 c.
10 d.
A _________ is a square array of numbers. 10.
matrix a.
determinant b.
array c.
transpose d.
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Chapter II
Mathematical Logic
Aim
The aim of this chapter is to:
introduce mathematical logic
describe operations on logic
Objective
The objectives of this chapter are to:
explicate logical connectives
elucidate laws of algebra of propositions
describe compound statement
Learning outcome
At the end of this chapter, you will be able to:
identify the use of mathematical logic
understand the complex procedures into simpler form
understand statement a nd the truth table
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2.1 Introduction
Mathematical Logic is a tool for providing a precise meaning to mathematical statements.
It includes:
A formal language for expressing them
A concise notation to represent them
A methodology for objectively reasoning about their truth or falsity
2.2 Defnition
The part of mathematics concerned with the study of formal languages, formal reasoning, the nature of
mathematical proof, provability of mathematical statements, computability, and other aspects of the foundations
of mathematics.
2.2.1 Statement
A statement is a declarative sentence which is either true or false but not both.
2.2.2 Truth Value
The truth value of a proposition is true (T) if it is of true proposition and false (F) if it is false proposition.
Example
P: The year 1973 was a leap year is a proposition readily decidable as false.
Note that the use of label P so that the overall statement is read p is the statement:The year 1973 was a leap
year.
So we use P, Q, R, S, T to represent statements and these letters are called as statement variables, that is, variable
replaced by statements.
Example
Determine whether the following sentences are statements are not.If it is a statement, determine its truth value.
The sun rises in west. False
128= 2
6
False
Is 2 an integer? Not a statement as it is interrogative Take the book not a statement
2.2.3 Truth Table
A table that gives the truth value of the compound statement in terms of its component part is called a truth table.
2.2.4 Compound Statements
A compound statement is a combination of two or more statements.
Example
Today is Friday and it is a holiday
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2.3 Statement
A statement is an assertion that can be determined to be True or False. A statement/simple statement or proposition
is a declarative sentence that is either True or False but not both. A simple statement is the basic building block of
the logic.
Those declarative statements will be admitted in the object language which have one and only one of two
possible values called Truth Value
The two truth values are true and false, which are denoted by T and F respectively
Occasionally they are represented using symbols 1 and 0
We do not use other kind of statements in object language such as exclamatory and interrogative
Declarative sentences in object language are of two types
The frst type includes those sentences which are considered to be primitive in the object language
This will be denoted by distinct symbols selected from uppercase letters A, B... P, Q...
Second type are obtained from the primitive ones by using certain symbols called connectives and certain
punctuation marks such as parentheses to join primitive sentences
In any case, all declarative sentences to which it is possible to assign one and only of the two possible truth values
are called statements.
The following are the statements which do not contain any connectives, these kinds of statements are called as
atomic or primary primitive statement.
Moscow is the capital of spain 2.
This statement is false 3.
1+101=110 4.
Close the door 5.
Toronto is an old city 6.
Man will reach mars by 2080 7.

The statements are discussed below
The statements 1 and 2 have truth values true or false
Sentence 3 is not a statement according to the defnition, because we cannot assign to it a defnite truth value
If we assign a value true then the statement 3 is false, if assigned false then the statement 3 is true
Sentence 4 is a statement; if the numbers are considered as decimal system then the statement is false. If it is
considered as binary number system, then the statement is true. So the statement 4 is true.
Statement 5 is not a statement as it is interrogative
Statement 6 is considered true in some part of the world and false in certain other parts of the world
The statement 7 could not be determined ,it will be determined only in the year or earlier when man reaches
mars before that date
2.4 Compound Statement
A statement represented by a single statement variable (without any connective) is called a simple (or primitive)
statement.
A statement represented by some combination of statement variables and connectives is called a compound
statement.
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Example
A dog or a car is an animal
A dog is not an animal
5<3
If the earth is fat, then 3+4 =7
2.5 Connectives
In case of simple statements, their truth values are fairly obvious. It is possible to construct rather complicated
statements from simpler statements by using certain connecting words or expressions known as sentential
connectives. The statements which we initially consider are simple statements, called atomic or primary statements.
New statement can be formed from atomic statements through the use of sentential connectives. The resulting
statement is called molecular or compound statements. Thus the atomic statements are those which do not have any
connectives. Capital letters are used to denote statements.
The capital letters with or without subscripts, will also be used to denote arbitrary statements. In the sense, a statement
P either denotes a particular statement or serves as a place holder for any statement .This dual use of the symbol
to denote either a defnite statement, called a constant, or an arbitrary statement called a variable.
The truth value of P is the truth table of actual statement which it represents.
It should be emphasises that when P is used as a statement variable, it has no truth value and such does not
represent a statement in symbolic logic.
Most mathematical statements are combinations of simpler statement formed through some choice of the words
not,and,or,if ...then and if and only if. These are called logical connectives or simply connectives and
are denoted by the following symbols:
Connective Symbol Formal name
Not or Negation
And Conjunction
Or Disjunction
If...then Conditional
If and only if Biconditional
Table 2.1 Symbols of connectives
2.5.1 Negation
Defnition of negation
If P is a statement variable,the negation of P is not P or it is not the case that P and is denoted by P.It has
opposite truth value from P.
The negation statement is generally formed by introducing the word not at a proper place in statement with the
phrase It is not the case that and read as not P.
Let P be a statement .The negation of P, written P or P is the statement obtained by negating statement P.
If the truth value of P is true then truth value of P is false, and if the truth value of P is false then truth value of
P is true.
This defnition of negation is summarized by the truth table below.
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P P
T F
F T
Table 2.2 Truth Table of Negation
Example
P:The integer 10 is even
Then P: The integer 10 is not even
P:London is a city
P:It is not case that London is a city
P:London is not a city
P:I went to my class yesterday.
P:I did not go to my class yesterday
P:I was absent from my class yesterday.
P:I went to my class yesterday.
P:I did not go to my class yesterday
P:I was absent from my class yesterday
Negation is called connectives although it only modifes a statement or a variable.
2.5.2 Conjunction
Let P and Q be statements. The conjunction of P and Q, written P Q,is the statement formed by joining statements
P and Q using the word and. The statement PQ is true if both P and Q are true; otherwise PQ is false.
The symbol is called and. Let P and Q be statements. The truth table of P Q is given below.
Defnition
If p and q are statement variables, the conjunction of p and q is p and q, denoted pq.The compound statement
pq .The compound statement p q is true when both p and q are true; otherwise, it is false.
P Q PQ
T T T
T F F
F T F
F F F
Table 2.3 Truth table of conjunction
Example
P: 2 is an even integer,
Q: 7 divide 14
R:2 is an even integer and 7 divides 14.
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P:It is raining today
Q:There are 20 tables in this room.
R:It is raining today and there are 20 tables in this room.
Jack and Jill went up the hill.
From this statement we get two statement Jack went up the hill and Jill went up the hill.
Then the given statement can be written symbolic from PQ.
2.5.3 Disjunction
Let P and Q be statements. The disjunction of P and Q ,written P Q ,is statement formed by putting statements P
and Q together using the word Or. The truth value of the statement PQ is T if atleast one of statements P and Q
is true. The symbol is called Or, for the statement P Q is given below.
Defnition
If P and Q are statement variables, the disjunction of P and Q is P or Q, denoted P Q.The compound statement
P Q is true if atleast one of P or Q is true; it is false when both P and Q are false.
P Q P Q
T T T
T F T
F T T
F F F
Table 2.4 Truth table for disjunction
Example
P:2
2
+3
3
is an even integer
Q:2
2
+3
3
is an odd integer then P Q:2
2
+3
3
is an even integer or 2
2
+3
3
is an odd integer
OR
P Q :2
2
+3
3
is an even integer or an odd integer

The notation for inequalities involves and and or statements.
Let a,b and c be particular real numbers.
a b means a < b or a= b
a<b<c means a<b and b<c
is a unary operation while and are binary operations.
3 0r -5 is negative truth value is false
or is an integer ---truth value is false
2.5.4 Conditional or Implication
Let P and Q be two statements.Then If P,then Q is the statement called an Implication or conditional statement,written
P Q .
The statement P Q has a truth value F when the truth value of P is true and Q is false.Otherwisetruth value of
conditional or implication is T.The statement P is called the antecedent or hypothesis and q is called consequent or
conclusion in P Q .According to the defnition,it is not necessary that there be any kind of relation between P and
Q in order to form P Q.The statement P Q is also to be read as
P implies Q
Or
P is suffcient for Q
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Or
Q if P
Or
Q whenever P.
In the implication P Q,P is called the hypothesis and Q is called the conclusion. The truth table of P Q is
given below.
Defnition
If P and Q are statements,the statemenif P then Q or P implies Q,denoted PQ is called the conditional
statement,or implication.
P Q P Q
T T T
T F F
F T T
F F T
Table 2.5 Truth table for implication
Example
If today is Sunday,then i will go for walk.
Let P:Today is Sunday
Q:I will go for walk
Variety of terminaology:
If P then Q Q if P
P implies Q Q when P
P only if Q Q follows from P
P is suffcient for Q Q is necessary for P
2.5.5 Biconditional or Biimplication
Let P and Q be two statements.Then P if and only if Q,written PQ is called the Biimplication or biconditional
of the statement P and Q.The statement PQ may also be read as P is necessary and suffcient for Q or Q is
necessary and suffcient for P or Q if and only if P or Q when and only when P.We defne that the Biimplication
PQ is considered to be true when both P and Q have the same truth values and false otherwise. It is denoted by
PQ.The truth table is given below.
P Q PQ
T T T
T F F
F T F
F F F
Table 2.6 Truth table of biimplication
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2.5.6 Contrapositive, Converse and Inverse
The contrapostive of P Q is QP
The converse of P Q is QP
The inverse of P Q is P Q
A tautology is a statement form where its truth values in all rows in the truth table are always true. A contradiction
is a statement form where its truth values in all rows in the truth table are always false.
A contingency is a statement form that is neither tautology nor contradiction. Normally t is denoted to use tautology
and c is used to denote a contradiction.
Example
Let P, Q, R be statement variables. Show that the statement form
P P is a tautology
(PQ) R is a contingency
a.
P P P P
F T T
T F T
Table 2.7 P P is a tautology
b.
P P P P
F T F
T F F
c.
P Q R PQ R (P Q) V R
F F F F T T
F F T F F F
F T F F T T
F T T F F F
T F F F T T
T F T F F F
T T F T T T
T T T T F T
Table 2.9 contingency
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2.7 Laws of Algebra
Following are the laws of algebra
2.7.1 Identity Law
P P P
P T T
P F P
P P P
P T P
P F F
TP P
FP T
PP T
PT T
PF P
P P T
P T P
P F P
2.7.2 Commutative Law
PQ Q P
PQQP
PQ Q P
P Q = QP
2.7.3 Complement Law
P P T
P P F
P P P
P PF
PPP
2.7.4 Double Negation
( P) P
2.7.5 Associative Law
P(QR) (PQ)R
P(QR)(PQ)R
2.7.6 Distributive Law
P(QR) (PQ)(PR)
P(QR) (PQ)(PR)
2.7.7 Absorption Law
P(PQ) P
P(PQ) P
2.7.8 Demorgans Law
(PQ)P Q
(PQ)P Q
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2.7.9 Equivalance of Contrapositive
PQQP
2.7.10 Others
PQP Q
PQ(PQ)(QP)
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Summary
Mathematical Logic is a tool for providing a precise meaning to mathematical statements.
A statement is a declarative sentence which is either true or false but not both.
The truth value of a proposition is true (T) if it is of true proposition and false (F) if it is false proposition.
A table that gives the truth value of the compound statement in terms of its component part is called a truth
table.
A compound statement is a combination of two or more statements.
All declarative sentences to which it is possible to assign one and only of the two possible truth values are
called statements.
It is possible to construct rather complicated statements from simpler statements by using certain connecting
words or expressions known as sentential connectives.
The negation statement is generally formed by introducing the word not at a proper place in statement with
the phrase It is not the case that and read as not P.
Let P and Q be two statements. Then If P, then Q is the statement called an Implication or conditional statement,
written P Q.
References
Fulda, J. S., 1993. Exclusive Disjunction and the Bi-conditional: An Even-Odd Relationship, Mathematics
Magazine.
Hallie, P. P., 1954. A Note on Logical Connectives, Mind 63.
Bartlett, A., Simple Mathematical Logic, [Video Online] Available at: <http://www.youtube.com/watch?v=PlSfS5-
jU_g > [Accessed 31 August 2012].
Dr. Kirthivasan, K., Propositional Logic, [Video Online] Available at: <http://www.youtube.com/
watch?v=xlUFkMKSB3Y > [Accessed 31 August 2012].
Lifschitz, V., Lecture notes on mathematical logic, [pdf] Available at: <http://www.cs.utexas.edu/~vl/
teaching/388Lnotes.pdf > [Accessed 31 August 2012].
Simpson, S., Mathematical Logic, [Online] Available at: <http://www.math.psu.edu/simpson/courses/math557/
> [Accessed 31 August 2012].
Dean McCullough, P., 1971. Logical Connectives for Intuitionist Propositional Logic, Journal of Symbolic
Logic.
Wansing, H., 2006. Logical Connectives for Constructive Modal Logic.
Hallie, P. P., 1954. A Note on Logical Connectives, Mind 63.
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Self Assessment:
Canada is a country .what kind of statement is it? 1.
Primitive statement a.
Compound statement b.
Elementary statement c.
Primary statement d.
A dog or a car is an animal. What kind of statement it is? 2.
Primitive statement a.
Compound statement b.
Elementary statement c.
Primary statement d.
What is the symbol for negation? 3.
a.
b.
c.
d.
What is the symbol for conjunction? 4.
a.
b.
c.
d.
What is the symbol for disjunction? 5.
a.
b.
c.
d.
What is the symbol for implication? 6.
a.
b.
c.
d.
If P is true and Q is False what is the value of P 7. Q?
T a.
F b.
Invalid c.
no value d.
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If P is true and Q is False what is the value of P 8. Q?
T a.
F b.
Invalid c.
no value d.
If P is true and Q is False what is the value of P 9. Q?
T a.
F b.
Invalid c.
no value d.
If P is true and Q is False what is the value of P 10. Q?
T a.
F b.
Invalid c.
no value d.
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Chapter III
Set Theory
Aim
The aim of this chapter is to:
defne a set
discuss different types of set
elucidate operations on sets
Objective
The objectives of this chapter are to:
discuss the types of sets
explicate null and universal set
explain Demorgans Law
Learning outcome
At the end of this chapter, you will be able to:
understand standard set
comprehend the concept of intersection and disjoint sets
understand operati ons on sets.
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3.1 Defnition of a Set
A set is a collection of well defned object enclosed within curly brackets, generally denoted by upper case letters.
The objects which form the set are called the elements or members of the set. The elements are denoted by lower
case letters.
Example
A= {1, 2, 3... 100} represents set of numbers from 1 to 100
V= {a, e, i, o, u} represents set of vowels in English alphabets
The following notation is used to show the set membership
x A means that x is a member of the set A.
x A means that x is not a member of the set A.
3.2 Standard Sets
Following are the standard sets
N= set of natural numbers = {1, 2, 3, 4...}
Z= set of all integers = {...,-3,-2,-1, 0,1,2,3...}
R= set of all rational numbers = {p/q: p is integer, q0}
Q=set of all real numbers
3.3 Representation of set
Following are the method for representing sets
3.3.1 Tabular Form/Roaster Method
In the tabular form, all elements of the set are enumerated or listed.
Example
The set of natural numbers from 1 to 100 is given by
N= {1, 2, 3, 4...100}
The set of vowels is given by
V= {a, e, i, o, u}
3.3.2 Rule Method
Under this method, the defning property of the set is specifed.
If all the elements in the set have a Property P, then we can defne the set as
A={x: x has the property P}
Example
N={x: 1x100, x is a natural number} or {x/1x100,xN}
Where, N represents natural number
V={x/x is a vowel of English alphabet}
3.3.3 Descriptive Form
In this method, the elements in the set are verbally described within the curly brackets
Example:
N= {natural numbers from 1 to 100}
V= {vowels of English alphabet}
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3.4 Types of Sets
Following are the types of sets
3.4.1 Finite Set
A set with a fnite or countable number of elements is called a fnite set.
Example:
V= {a, e, i, o, u}
3.4.2 Empty or Null Set
A set which contains no elements is called an empty set or a null set. An empty set is denoted as { } or .
Example:
A= { }
A=
3.4.3 Subset
Set P is a subset of a set Q, symbolised by P Q, if and only if all the elements of set P are also the element of set
Q.
Note:
every set is a subset of itself
null set is a subset of every set
Example:
Let A = {1, 2, 3}
Then { }, {1}, {2}, {3},{1,2},{1,3},{2,3}.{1,2,3} are the subsets of the set A={1,2,3}.
3.4.3.1 Proper Subset
Set G is a proper subset of H, symbolised by G H, if and only if all the elements of set G is elements of set H
and set G set H.
That is set H must contain at least one element not in set G.
Example
Consider above example, {},{1},{2},{3},{1,2},{1,3},{2,3} are the proper subset of A={1,2,3}.
3.4.3.2 Improper Subset
Set S is an improper subset of T, symbolised by S T , if and only if all the elements of set S are the elements of
set T and set S = set T.
Example
In the above example {1,2,3} is an improper subset of set A={1,2,3}

3.4.4 Infnite Set
Neither an empty set nor a fnite set is called an infnite set. Such set will contain infnitely many elements.
Example
N= {1, 2, 3...}
Z= {...-3,-2,-1, 0,1,2,3...}
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3.4.5 Disjoint Sets
Two sets are said to be disjoint sets if they do not have any common elements.
Example
If
A={x: x is an even number}
B={y: y is an odd number}
Then A and B will be disjoint sets.
3.4.6 Overlapping Sets
Two sets are said to be overlapping sets, if they have some common elements.
Example
A= {1, 2, 3, 4, 5}
B= {3, 4, 5, 6, 7}
These sets are overlapping sets as the elements 3, 4 and 5 are common to both set.
The element common to both sets is called the intersection of the two sets and is denoted as A B.
On the other hand, the addition of two sets is called the union of two sets and is denoted by A B.
3.4.7 Universal Set
A universal set is the set that contains the element of all the sets under consideration. It is usually denoted by U, S
or .
Example
A={4,7,8,9}, B={-4,-2,0,1,4,7,10}.
The set of Integers, I= {...,-2,-1, 0, 1, 2...} will be the universal set for A and B.
3.4.8 Equal Set
Two sets are said to e equal if they contain the same elements.
Example
A= {2, 4, 6, 8} B={x: x is an even number between 1 and 9} are equal set as they contain the same elements
P= {1, 3, 6} Q= {6, 1, 3} is also an equal set.
3.4.9 Complement Set
Given a set A, the complement set is the set that contains elements not belonging to A and is denoted by A. The
union (will be discussed in operations on set) of the given set and its complement will give the universal set. That
is A A = U.
Example
A={x: x is a Mathematics book in the Library}
A ={y: y is not a Mathematics book in the Library}
And the universal set in this case is U= the set of all books in the Library}
3.4.10 Equivalent Set
Two sets are said to be equivalent set if number of elements in one set is equal to the number of elements in the
other set. The number of elements in a set is known as Cardinal number of the set.
So, if the cardinal numbers of two sets are equal then those two sets are said to be equivalent set. Cardinal number
of the set A is represented by n (A).
Example
A= {1, 2, 3, 4}
B= {a, b, c, d}
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Here, n (A) =4 and n (B) =4
So the sets A and B are said to be Equivalent sets.
3.5 Illustration of Various Sets
Let us consider three sets A, B and C in the rule form as A= {x: x are the vowels}, B= {x: x are the consonants}
C={x: x is the frst 10 alphabets of English}
In tabular form
A={a,e,i,o,u}, B={b,c,d,f,g,h,j,k,l,m,n,p,q,r,s,t,v,w,x,y,z},C={a,b,c,d,e,f,g,h,i,j}
set A and B are disjoint sets as they no elements of A is present in B and vice versa.
set A and C are overlapping sets as both contains the element a, e, i in common.
set B and C are also overlapping set as both contain the element b, c, d, f, g, h, j in common.
set of all alphabets of English is the universal set for A, B, C. U= {a, b, c, d... z}
set A is a complement of set B as it contains elements not contained in set A and union of set A and set B will
give the Universal set U.
3.6 Basic Operations on Sets
Following are the basic operations on sets
3.6.1 Intersection of Two Sets
The intersection of two sets is the set of elements common to both the given sets. The intersection of two sets A
and B is denoted as A B.
In notation form, we can defne the intersection of two sets A and B as
A B = {x: x A, x B}.
If, A B = , then A and B are said to be disjoint sets. If A B ,then A and B are called overlapping sets.
Example
Given
A= {1, 2, 3, 4, 5}
B= {4, 5, 6, 7, 8}
Then A B = {4, 5}
3.6.2 Union of Two Sets
The union of the two sets is the set containing the elements belonging to A and also the elements belonging to B.The
union of these sets is denoted as A B. In notation form, we can defne the union of the two sets as A B = {x: x
A, x B, x A B}.
Example
A= {1, 2, 3, 4, 5,}
B= {4, 5, 6, 7, 8}
Therefore, A B = {1, 2, 3, 4, 5, 6, 7, 8}
3.6.3 Relative Complement or Difference of Two Sets
The difference of two sets A and B is the set of elements that belong to A but do not belong to B.The difference of
two sets is denoted by
A B .In notation form, we can defne the difference of two sets as
A B = {x: x A, x B}
Similarly, B A ={x: x B, x A}
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Example
A= {1, 2, 3, 4, 5}
B= {4, 5, 6, 7, 8}
Then, A B = { 1,2,3} Though 4,5 belongs to A it also belongs to B so that is not included .
3.6.4 Complement of a Set
Complement set is the set that contains elements not belonging to A but belonging to the universal set. In notation
form, we can defne the complement of a set as A = {x: x A, x U}.
Example
Given U= { 1,2,3,4,5,6,7,8,9,10}
A= {1, 2, 3}
Therefore A = {4, 5, 6, 7, 8, 9, 10}
3.6.5 Symmetric Difference of Two Sets
The symmetric difference of two sets is the union of both the relative complements.
A B = (A B) (B A)
It can also be expressed as relative complement of union of the two sets and intersection of the two sets.
A B = (A B) (A B)
Example
Given A = {1, 2, 3, 4, 5}
B= {4, 5, 6, 7, 8}
Solution 1:
A B = (A B) (B A)
A B = {1, 2, 3}
B A = {6, 7, 8}
So, A B = {1, 2, 3} {6, 7, 8}
Therefore A B = {1, 2, 3, 6, 7, 8}
Solution 2:
A B = (A B) (A B)
A B = {1, 2, 3, 4, 5, 6, 7, 8}
A B = {4, 5}
A B = {1,2,3,4,5,6,7,8} - { 4,5}
Therefore A B = {1, 2, 3, 6, 7, 8}
3.7 Properties of Set
Following are the properties of sets
3.7.1 Commutative Law
A B = B A
A B = B A
A B = B A
3.7.2 Associative Law
A (B C) = (A B) C
A (B C) = (A B) C
A (B C) = (A B) C
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3.7.3 Distributive Law
A (B C) = (A B) (A C)
A (B C) = (A B) (A C)
3.7.4 Identity Law
A = A
A U = A
= U
U =
3.7.5 Complement Law
A A = U
A A =
3.7.6 Idempotent Law
A A = A
A A = A
3.7.7 Bound Law
A U = U
A =
3.7.8 Absorption Law
A (A B) = A
A (A B) = A
3.7.9 Involution Law
(A)= A
3.7.10 De Morgans Law
The complement of the union of two sets is equal to the intersection of their complements.
(A B) = A B
The complement of the intersection of two sets is equal to the union of their complements.
(A B) = A B
A - (B C) = (A B) (A C)
A (B C) = (A - B) (A C)
3.7.11More Results
n (A B) = n (A) + n (B) n (A B)
n(A B C) = n(A) +n(B) +n(C)- n( A B)-n(B C) n(A C) + n( ABC)
Solved Examples
Example 1
If A= {1,2,3,4} , B= {2,4,6,8} ,C= {3,4,5,6,8}, U ={1,2,3,4,5,...,10}
Find A, B C, A C
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Solution:
A = {5, 6, 7, 8, 9, 10}
B C = {2, 3, 4, 5, 6, 8}
A C = {3, 4}
Example 2
If A= {1,2,3,4} , B= {2,4,6,8} ,C= {3,4,5,6,8}, U ={1,2,3,4,5,...,10}
Find A B, B C, (A B)
Solution:
A B= {1, 3}
B C= {2}
A B = {1, 2, 3, 4, 5, 6, 8}
(A B)= {7, 9, 10}
Example 3
If U ={1,2,3...10} A={3,4,6,10} B={1,2,4,5,6,8} Verify De Morgans laws of complementation.
(A B) = A B
Solution:
LHS: (A B)
A B = {1, 2, 3, 4, 5, 6, 8, 10}
(A B) = {7, 9} --------- (1)
RHS: A B
A = {1, 2, 5, 7, 8, 9}
B = {3, 7, 9, 10}
A B = {7, 9} --------- (2)
From (1) and (2), it is clear (A B) = A B
(A 1. B) = A B
Solution:
LHS = (A B)
A B = {4, 6}
(A B) = {1,2,3,5,7,8,9,10}-----------(1)
Now, A = {1, 2, 5, 7, 8, 9}
B = {3, 7, 9, 10}
Therefore, A B = {1,2,3,5,7,8,9,10}-------(2)
From (1) and (2) it is clear that (A B)= A B
Hence Verifed.
Example 4
If A= {-8,-7,-5, 1, 2, 4}
B= {-7, 1, 3, 4, 5, 6}
C= {-8,-5, 2, 4, 6, 7}
Verify A- (B C) = (A B) (A C)
Solution:
LHS: A (B C)
B C = {-7, 1, 3, 4, 5, 6,-8,-5, 2, 7}
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Therefore A (B C) = { } ------ (1)
RHS: (A B) (A C)
Now, A B = {-8,-5, 2}
A C = {1,-7}
(A B) (A C) = { } --------- (2)
From (1) and (2), it is clear that A (B C) = (A B) (A C)
Hence verifed.
Example 5
If A= {-9,-7,-6,-3,0,2},B= {-7,-3,0,4,5,6} C={-9,-6,2,-7,8},Verify
A (B C) = (A B) (A C)
Solution:
L H S:
A (B C)
B C = {-7}
Therefore A (B C) = {-9,-6,-3, 0, 2} -------- (1)
Now, A B = {-9,-6, 2}
A C = {-3, 0}
RHS: (A B) (A C) = {-9,-6, 2,-3, 0} ----- (2)
From (1) and (2), it is clear A (B C) = (A B) (A C)
Hence verifed.
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Summary
A set is a collection of well defned object enclosed within curly brackets.
The objects which form the set are called the elements or members of the set.
In the tabular form, all elements of the set are enumerated or listed.
Set P is a subset of a set Q, symbolised by P Q, if and only if all the elements of set P are also the element of
set Q.
A set which contains no elements is called an empty set or a null set.
Two sets are said to be disjoint sets if they do not have any common elements.
Two sets are said to be overlapping sets, if they have some common elements.
A universal set is the set that contains the element of all the sets under consideration.
Two sets are said to be equal if they contain the same elements.
The intersection of two sets is the set of elements common to both the given sets.
The union of the two sets is the set containing the elements belonging to A and also the elements belonging to
B.
A B = (A B) (B A)
Demorgans Law(A B) = A B
References
Akekar, R., 2008. Discrete Mathematics: Set theory, 2nd ed., Dorling Kindersley Publication India.
T. Veeraranjan, 2008. Discrete Mathematics with graph theory and Combinatorics: Set theory, 7th ed., McGraw-
Hill Publication.
Lipchutz, S., 1998. Set Theory and related topics, 2nd ed., McGraw-Hill Publication.
Arithmetic and geometric progressions , [Online] Available at: < http://www.mathcentre.ac.uk/resources/uploaded/
mc-ty-apgp-2009-1.pdf > [Accessed 31 August 2012].
Arithmetic and geometric progressions, [Online] Available at: < http://maths.mq.edu.au/numeracy/web_mums/
module3/Worksheet36/module3.pdf > [Accessed 31 August 2012].
2011, Arithmetic & Geometric progressions, [Video Online] Available t: < http://www.youtube.com/
watch?v=ze0hNuxJaVE > [Accessed31 August 2012].
Lee, D., Arithmetic Progression, [Video Online] Available at: < http://www.youtube.com/watch?v=kGh9BtU-
OVU > [Accessed 31 August 2012].
Waters, D., 2006. Quantitative Methods for business, Set Theory, 4th ed., Prentice Hall Publication.
Bedward, D., 1999. Quantitative Methods, Set theory, Elsevier.
Slater, J, C., 2007. Quantitative Methods, Set theory, Thomson Learning.
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Self Assessment
A ____ is a collection of well defned object enclosed within curly brackets. 1.
Set a.
Subset b.
Object c.
Element d.
A set which contains no elements is called _____ set. 2.
equal a.
equivalent b.
empty c.
fnite d.
Two sets are said to be __________ if they do not have any common elements. 3.
disjoint sets a.
overlapping sets b.
intersection sets c.
equal sets d.
Two sets are said to be ______ if number of elements in one set is equal to the number of elements in the other 4.
set.
disjoint set a.
equivalent set b.
overlapping set c.
intersection set d.
If A = {1,2,3,4,5} and B={4,5,6,7,8} ,what is A B ? 5.
{4,5} a.
{6,7,8} b.
{1,2,3} c.
{1,2,3,4,5} d.
Is P= {1, 3, 6} Q= {6, 1, 3} an equal set? 6.
True a.
False b.
Is A= {1, 2, 3, 4} and B= {a, b, c, d} an equivalent set? 7.
True a.
False b.
If A= {1,2,3,4} and U ={1,2,3,4,5,...,10},What is the value of A? 8.
{1,2,3,4,5} a.
{4,5,6,7} b.
{7,8,9,10} c.
{5,6,7,8,9,10} d.
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If B= {2,4,6,8} and C= {3,4,5,6,8} what is the value of B 9. C?
{2,3,4,5,6,8} a.
{2,4,6,8} b.
{3,4,5,6,8} c.
{4,6,8} d.
If A= {1,2,3,4} and C= {3,4,5,6,8} what is the value of A 10. C?
{1,2,3,4} a.
{3,4} b.
{3,4,5,6,8} c.
{1,2,3,4} d.

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Chapter IV
Progression
Aim
The aim of this chapter is to:
introduce the concept of arithmetic progression
defne the concept of geometric progression
explicate the formulae for arithmetic progression
Objective
The objectives of this chapter are to:
elucidate progression
discuss arithmetic and geometric progression
explain formulae for arithmetic and geometric progression
Learning outcome
At the end of this chapter, you will be able to:
understand the concept of arithmetic and geometric progression
identify the arithmetic representation of a series
comprehend the geom etric representation of series
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4.1 Introduction
Progression is a pattern of numbers wherein a quantity increases or decreases progressively by fxed amount. In
other words, consecutive term in the series increase or decrease by a fxed number. A succession of numbers formed
and arranged in a defnite order according to certain defnite rule, is called a progression.
4.2 Arithmetic Progression
If quantities increase or decrease by common difference, then they are said to be in arithmetical progression (AP).If
each term of a progression differs from its preceding term by a constant, then such a progression is called arithmetical
progression. This constant difference is called the common difference of the AP.
Let us look at few lists as follows
3,5,7,9,11,13,15
4,8,12,16,20,24
1, 4, 7,10,13,16
-10,-6,-2, 2,6,10
20, 18, 16, 12, 10.
Above we notice that the numbers in each of the list are different but there is a pattern that helps us determine the
next so let us identify the patterns in the above list
leaving the frst number each successive number is obtained by adding 2
leaving the frst number each successive number is obtained by adding 4
leaving the frst number each successive number is obtained by adding 3
leaving the frst number each successive number is obtained by adding 4
leaving the frst number each successive number is obtained by adding -2
Thus we observe that
each list starts with a number chosen arbitrarily
every successive number in the list is formed by adding the same fxed number to the previous number
Thus to generalize it, we have
Let
a be any starting term
d be the common difference between two successive terms
Then a, a+d,(a+d) +d,((a+d)+d)+d,
Therefore, a, a+d, a+2d, a+3d are the successive terms of an arithmetic progression.
The points to be remembered are:
The sequence of the next number is very important and we cannot change the sequence as it will destroy the
pattern
While fnding the common difference we must subtract the nth term from (n+1)th term even if it is smaller
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4.3 Formulae for Arithmetic Progression
4.3.1 The general form of an AP
The general form of an AP is given by
a,a+d,a+2d,a+3d a(n-1)d
Where, a is the frst term
a+ (n-1) d is the n
th
term
d is common difference
4.3.2 The n
th
term of an AP
The n
th
term of an AP is given by
= a + (n-1) d
4.3.3 Sum of frst n terms ( ) of an AP
The Sum of frst n terms ( ) of an AP is usually denoted by and is given by
= (a + l) = (a
1
+ a
n
)
Or
= [a + (a+ (n-1) d)] = (2a+ (n-1) d)
Where,
a is the frst term of AP
d is the common difference
l is the last term
a
n
is the n
th
term
4.4 Arithmetic Mean
When three quantities are in AP, the middle one is said to be the arithmetic mean of the other two.
If a and b are the two quantities in AP and if A is the arithmetic mean then,
A = (a+b)/2
a, A,b are in AP.
If a and b are two given quantities in A.P., and if n arithmetic means are to be inserted between a and b ,means
a,A
1
,A
2
,A
3
,.......,A
n
,b are in AP where A
1
,A
2
,A
3
,.......,A
n
are means.
Then
m th arithmetic mean (A
m
) is given by a +{m(b-a)/(n+1)}
Where
a is the frst term of the AP
b is the last term.
n is the number of arithmetic means between them
m is the m
th
arithmetic mean
4.5 Geometric Progression
If quantities increase or decrease by common multiple, then they are said to be in geometric Progression (GP)
Let us look at a few lists as follows:
3, 6, 12, 24, 48, 96, 192,
8, 4, 2, 1, 1/2, 1/4, 1/8
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1,3,9,27,81,243,729
3,-6, 12,-24, 48,-96, 192
6561,-2187, 729,-243, 81,-9
Above we notice that the numbers in each of the lists are different but there is a pattern that helps us determine the
next term so let us identify the patterns in the above lists
leaving the frst number each successive number is obtained by multiplying by 2
leaving the frst number each successive number is obtained by multiplying by or dividing by 2
leaving the frst number each successive number is obtained by multiplying by 3
leaving the frst number each successive number is obtained by multiplying by -2
leaving the frst number each successive number is obtained by multiplying by -1/3 or dividing by -3
Thus we observe that
each list starts with a number chosen arbitrarily
every successive number in the list is formed by multiplying or dividing with the same fxed number to the
previous number
Therefore, to generalize what we have
Let
a be any starting term
r be the common multiple between two successive terms
Then, a, ar, (ar) r, ((ar) r) r
Therefore a, ar, ar
2
, ar
3
are the successive terms of a geometric progression.
The points to remember
the sequence of the next number is very important and we cannot change the sequence as it will destroy the
pattern
while fnding the common multiple by dividing (n+1)th term even if it smaller
4.6 Formulae for Geometric Progression
4.6.1 The general form of a GP
The general form of a GP is a, ar, ar
2
, ar
3
, . ar
n-1
Where a is the frst term a(r)
n-1
is the n
th
term r is the common multiple
4.6.2 The n
th
term T
n
of a GP
The n
th
term T
n
of a GP is given by T
n
= a(r)
n-1
4.6.3 The sum of frst n terms S
n
of a GP
The sum of frst n terms of a GP is usually denoted by S
n
and is given by
S
n =
for r>1
S
n =
for r<1
S
n =
for r<1 and n is infnite
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Where
a is the frst term of AP
r is the common ratio or multiple
l is the last term
a
n is
the n
th
term.
4.7 Geometric Mean
When three quantities are in GP, the middle one is said to be the geometric mean of the other two.
If a and b are two quantities in GP and if G is the geometric mean then,
G=
A, G, b are in GP.
If a and b are two given quantities in G.P., and if n geometric means are to be inserted between a and b, means a,
G
1
, G
2
, G
3
... G
n
, b are in GP where, G
1
, G
2
, G
3
... G
n
, are means
Then
m th geometric mean(G
m
) is given by
Where
a is the frst term of the AP
b is the last term
n is the number of geometric means between them
m is the m
th
geometric mean
4.8 Harmonic Progression
If quantities increase or decrease such that the inverse of the quantities have a common difference (are in a arithmetic
progression),then they are said to be in Harmonic Progression(HP).
Let us look at a few lists as follows:
10, 12, 15...
3, 3/2, 1...
10, 20/3, 5, 4...
If we look at the inverse of the following is the format of the lists:
1/10, 1/12, 1/15
1/3, 2/3, 1....
1/10, 3/20, 1/5, 1/4
Above we notice that the inverse of the given numbers in each of the lists are different but there is a pattern which
is an AP.Let us fnd the common difference
leaving the frst number each successive number is obtained by adding -1/60
leaving the frst number each successive number is obtained by adding 1/3
leaving the frst number each successive number is obtained by adding 1/20
Thus we observe that
each lists starts with a number chosen arbitrarily
all the inverse of the numbers are in AP
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Thus to generalize what we have
Let
a be any starting term
d be the common difference between two successive terms
Then,
a, a+d,(a+d)+d,((a+d)+d)+d,...
Therefore a, a+d, a+2d, a+3d... are the successive terms of an arithmetic progression
Therefore 1/a, 1/a+d, 1/a+2d, 1/a+3d ... will be the harmonic progression.
The points to remember are:
the sequence of the next number is very important and we cannot change the sequence as it will destroy the
pattern
while fnding the common difference we must subtract the n
th
term from (n+1) th term even if it is smaller
4.9 Formulae for Harmonic Progression
4.9.1 The General Form of HP
The general form of a HP is:
1/a, 1/a+d, 1/a+2d, 1/a+3d...1/a+ (n-1) d
Where
a is the 1
st
term
1/a+ (n-1) is the nth term
d is the common difference
4.9.2 The nth term (T
n
)of a HP
The nth term (T
n
) of a HP is given by
T
n
=
4.10 Harmonic mean
When three quantities are in HP,the middle one is said to be the Harmonic mean of the other two. If a and b are two
quantities in HP and if H is the Harmonic mean then,
H=
a, H, b are in HP.
4.11 Comparison between AP and GP
Following is the difference between AP and GP
Description Arithmetic Progression Geometric Progression
Principal Characteristic Common Difference(d) Common Ratio(r)
n
th
term T
n
=a+(n-1)d T
n
= a r
(n-1)
Mean A= (a+b)/2 G=(ab)
1/2
Sum of First n terms S
n
=n/2[2a+(n-1)d]=n/2[a+l] S
n
=a(1-r
n
)/(1-r)
m th mean a+[m(b-a)/(n+1)] A(b/a)
m/(n+1)
Table 4.1 Comparison between AP and GP
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4.12 Important Rules on Arithmetic mean(AM),Geometric Mean (GM) and Harmonic
Mean(HM)
AM GM HM
GM = (AM x HM)
Solved Examples
Example 1
Find the sum of the series 5/2,4,11/2,7,.upto 21 terms
Solution:
d=4-5/2 = 3/2; n=21; a=5/2 (from the data given)
S
n
= [21/2] x [2 x (5/2) +20 x (3/2)]
= [21/2] x [5+30]
= 735/2
=367.50
Example 2
Find the 74
th
term of the series 3, 7, 11, 15
Solution:
a=3; d=7-3=4; n= 74
T
n
= a + (n-1) d
T
74
= 3+73 x 4 =3 + 292=295
Example 3
Find the total earning over 6 years for a person whose salary is Rs.30000 p.a and increases by 1500 p.a, every six
months.
Solution:
For each six months he earns half his annual salary
Therefore, a =30000/2=15000
To fnd the sum of 12 terms
d=750
S
12
=12/2[2 x (15000) +11 x 750] = 6 [30000+8250]
= Rs.229500
Example 4
Find the sum of frst 6 terms of the series 3, 9, 27, 81 .
n=6; r= 27/9 =3; a=3
S
n =
3(1-3
6
) / (1-3) =1092
For an infnite series, S

(if |r| 1)
S

= a/ (1-r) (if |r| 1)
Example 5
Find the sum of the infnite series 1, 0.5, 0.25
Solution:
r=0.5 since -1 0.5 1 S =a/ (1-r)
S= 1/ (1 - 0.5) =1/0.5 = 2
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Example 6
Find the 10
th
term of the series 4, 16,64,256,1024
Solution:
The given series is in geometric progression where a=4 and r=4
To fnd T
10
T
10
= a r
(10-1)
=4 x 4
9
= 4
10
Example 7
The sum of n terms of the series 2, 5, 8 is 950 fnd n
Solution:
Given S
n
= 950; a=2 and d=5-2=3
Therefore S
n
= a + (n-1) d
950 = 2 + (n-1) 3
950-2 = (n-1) 3
948= (n-1) 3
n-1 = 948/3
n-1 = 316
n=316+1=317
Therefore the value of n is 317.
Example 8
Sum of a GP whose common ratio is 3 is 728.The last term is 486.Find the frst term.
Solution: Sum= S
n
=728; r= 3; l=486
Let the frst term be a and number of terms be n
By the formula,
T
n
=a r
n-1
486 = a 3
n-1
Therefore,3
n
/3 =486/a
Which implies 3
n
=1458/a
Also the sum of n terms = S
n
=a (3
n
-1)/ (3-1) =728
Substituting the value of (3
n
) in the above equation
From above equation we get, a [1458/a-1] =1456
Therefore, a [1458 a] = 1456.a
a
2
=2.a
Which implies a=2
Example 9
Find the geometric mean between the terms 4 and 25
Solution:
The geometric mean G = (4* 25)
1/2
=100

=10
Thus 4, 10 and 25 are in GP
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Summary
Progression is a pattern of numbers wherein a quantity increases or decreases progressively by fxed amount.
A succession of numbers formed and arranged in a defnite order according to certain defnite rule, is called a
progression.
If quantities increase or decrease by common difference, then they are said to be in arithmetical progression
(AP).
a, a+d, a+2d, a+3d are the successive terms of an arithmetic progression.
The n
th
term of an AP is given by
= a + (n-1) d
The Sum of frst n terms ( ) of an AP is usually denoted by and is given by
= (2a+ (n-1) d)
The n
th
term T
n
of a GP is given by
T
n
= a(r)
n-1
The sum of frst n terms of a GP is usually denoted by S
n
and is given by
S
n =

References
Guy, R. K., 1994. Unsolved Problems in Number Theory, 2nd ed., Springer-Verlag.
Hardy, G. H. and Wright, E. M., 1979. An Introduction to the Theory of Numbers, 5th ed., Oxford Univ. Press,
New York.
Prof. Chakraborthy, Introduction to the theory of Probability, [Video Online] Available at: <http://www.youtube.
com/watch?v=r1sLCDA-kNY> [Accessed 31 August 2012].
Penfeld, P., 2010, Probability, [Video Online] <http://www.youtube.com/watch?v=_oBgnTy85fM> [Accessed
31 August 2012].
Fill, J., Journal of theoretical Probability, [Online] Available at: <http://www.springer.com/mathematics/
probability/journal/10959> [Accessed 31 August 2012].
Khan, Probablity, [Online] Available at: <http://www.khanacademy.org/math/probability/v/basic-probability>
[Accessed 31 August 2012].
Waters, D., 2006. Quantitative Methods for business, Progression, 4th ed., Prentice Hall Publication.
Bedward, D., 1999. Quantitative methods, Arithmetic Progression, Elsevier.
Slater, J, C., 2007. Quantitative Methods, Progression, Thomson Learning.
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Self Assessment
________ is a pattern of numbers wherein a quantity increases or decreases progressively by fxed amount. 1.
Progression a.
Mean b.
Geometric c.
Arithmetic d.
A succession of numbers formed and arranged in a defnite order according to certain defnite rule, is called a 2.
_______ .
mean a.
arithmetic b.
geometric c.
progression d.
If quantities increase or decrease by common difference, then they are said to be in ________ progression. 3.
geometric a.
arithmetic b.
harmonic c.
mean d.
The following series is in which progression? Series: 4,8,12,16,20,24 4.
geometric a.
arithmetic b.
harmonic c.
mean d.
The following series is in which progression? Series: 3,-6, 12,-24, 48,-96, 192 5.
geometric a.
arithmetic b.
harmonic c.
mean d.
The following series is in which progression? Series: 1/10, 3/20, 1/5, 1/4 6.
if AM is 10, 20/3, 5, 4...
geometric a.
arithmetic b.
harmonic c.
mean d.
What is the sum of the series 5/2,4,11/2,7,.upto 21 terms? 7.
350 a.
360 b.
357.60 c.
367.60 d.
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What is the sum of the infnite series 1, 0.5, 0.25? 8.
1 a.
2 b.
3 c.
4 d.
What is the 74 9.
th
term of the series 3, 7, 11, 15?
265 a.
285 b.
295 c.
300 d.
What is the sum of frst 6 terms of the series 3, 9, 27, 81 .? 10.
1092 a.
1000 b.
1900 c.
1192 d.
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Chapter V
Probability
Aim
The aim of this chapter is to:
defne probability
expalin the concept of sample space and events
elucidate conditional probability
Objective
The objective of this chapter is to:
explain rules of probability
discuss Bayes theorem
discuss types of events
Learning outcome
At the end of this chapter, you will be able to
understand the ways to solve probability
enlist the steps to solve probability
underst and the formulae to calculate conditional probability
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5.1 Introduction
Probability is the method to determine the chance of happening of a particular event in a random experiment.
Example: probability of a good monsoon.
5.2 Defnitions
5.2.1 Experiment
An operation which can produce some well defned outcomes is called an experiment.
5.2.2 Deterministic Experiment
Deterministic experiment is the one which gives a certain defnite result. example: acid is added to a base.
5.2.3 Random Experiment
Random experiment is the one which gives one or more results under identical conditions. An experiment in which all
possible outcomes are known and the exact output cannot be predicted in advance is called a random experiment.
5.2.3.1 Examples of Performing a Random Experiment
rolling an unbiased dice
tossing a fair coin
drawing card from a pack of well shuffed cards
picking up a ball of certain colour from a bag containing balls of different colours
5.2.3.2 Details
When we throw a coin, then either head (H) or a tail(T) appears
A dice is a solid cube, having 6 faces ,marked 1,2,3,4,5,6 respectively, when we throw a die, the outcome is the
number that appears on its upper face
A pack of cards has 52 cards; it has 13 cards of each suit namely spades,clubs,hearts and diamonds; cards of
spades and clubs are black cards; cards of heart and diamonds are red cards; there are four honours of each suit,
they are Aces,Kings,Queens and Jacks; these are called face cards
5.2.3.3 Sample Space :
The set of all possible outcomes of a random experiment is known as the sample space and every outcome is a sample
point. When we perform an experiment, then the set S of all possible outcomes is called the sample space.
Examples of Sample Space
In tossing a coin,S={H,T}
If two coins are tossed ,then S={HH,HT,TH,TT}
In rolling a dice , we have S={1,2,3,4,5,6}
5.2.4 Elementary Event
An event is a subset of the sample space.An event defned by singleton set is called an elementary event or a simple
event.
5.2.5 Impossible Event
The event defned by an empty set is called an impossible event.
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5.2.6 Events
Events are said to be mutually exclusive these events cannot occur simultaneously.
5.2.7 Mutually Exclusive Event
Two or more event are said to be mutually exclusive if these events cannot occur simultaneously.
5.2.8 Compatibility
Two or more events are said to be compatible if they can occur simultaneously.
5.2.9 Independent Events
Two or more events are said to be independent if the happening or non-happening of any event does not affect the
happening of others. Events are no way related to each other.
5.2.10 Dependent Events
Two or more events are said to be dependent if the happening or non-happening of any event does affect the happening
of others. Events are related to each other.
5.3 Probability
If A is an event of the sample space S, then
Probability of A=P (A) =Number of cases favourable for A /Total number of cases
Where
0 P (A) 1
P (A) +P (A) =1
If a cases are favourable to A and b case are not favourable to A then
P (A) =a/ (a+b); P (A) =b/ (a+b)
We say that the odds in favour of A are a: b i.e. a to b and odds against A are b: a i.e. b to a. Thus if an event can
happen in a ways and fail in b ways, and each of these is equally likely, the probability or chance of its happening
is a/ (a+b) and that of its failing is b/ (a+b).The chance of happening of an event a is also stated as the odds are
a to b in favour of the event, or b to a against the event.
If p is the probability of happening of an event then (1-p) is the probability of its not happening.
5.3.1 Probability of Occurrence of an Event
Let S be the sample space and let E be an event.
Then E S
Therefore, P (E) =
5.3.2 Results on Probability
P(S) =1
0 P(E) 1
P( )= 0
For any events A and B ,we have P(A B) =P(A)+P(B)-P(A B)
If denotes (not A),then P()=1-P(A)
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5.3.3 Binomial Distribution
If n trials are performed under the same condition and probability of success in each trial is p and q=1-p, then the
probability of exactly r successes in n trials is:
P(r) = n
5.3.4 Geometric Theorem
If an experiment is performed indefnitely under the same conditions then the probability of frst success in the nth
trial is given by
P (n) =P
Where p =probability of success in each experiment
q is the probability of not getting success =1-p
if and are the chances that the two independent events will happen separately then the chance that they will both
happen is x .Also, the chance that the frst event happens and the second fails is x (1- ) and so on.
If an event can happen in two ways which are mutually exclusive and if and are the two respective probabilities
then the probability then the probability that it will happen in some one of these ways is + .
5.4 Conditional Probability
5.4.1 Conditional probability of Dependent Events
Consider the three events. Two dies are tossed then
A: sum of the scores is even
B: sum of the scores is less than 6
Writing the sample space it can be seen easily that the probability of event A is and that of event B is 5/18.But if
it is given that the event A has already occurred then the probability that sum of the scores is less than 6 is 2/9.
The event B is same but its probability changes accordingly A has occurred or not. Thus the probability of an event
B when event A has already occurred is denoted by P (B| A) and is defned by
P (B | A) = and P (A | B) = where A B is A and B.
5.4.2 Conditional probability of Independent Events
We defne the conditional probability of event A, given that B has occurred, in case of A and B, as the probability
of event A
P (A | B) =P (A)
5.5. Multiplication Rule
5.5.1 Independent Events
The joint probabilities of two independent events are equal to the product of their individual probabilities.
P (A and B)= P(A).P(B)
5.5.2 Dependent Events
A joint probability of two dependent events A and B is equal to probability of A multiplied by probability of B,
given that A has occurred.
P (A and B) =P (B).P (A | B)
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This formula is derived from the formula of conditional probability of dependent events
P (A| B) = P (A and B)/P (A)
P (A and B) =P (A| B) .P (A)
5.6 Steps to Solve Probability
Defne events
Find the total outcome of the experiment
Find the probability of each event
If the words ,either or are used check whether the events are mutually exclusive or not to apply addition
rule
If the words both and are used check whether the events are independent or dependent to apply proper
multiplication rule

5.7 Bayes Theorem
Thomas Bayes addressed both the case of discrete probability distributions of data and the more complicated case
of continuous probability distributions.
In the discrete case, Bayes theorem relates the conditional and marginal probabilities of events A and B, provided
that the probability of B does not equal to zero.
Each term in Bayes theorem has conventional name:
P ( A) is the prior probability or marginal probability of A. It is prior in the sense that it does not take into
P ( A|B) is the conditional probability of A, given B. It is also called the posterior probability because it is derived
from or depends upon the specifed value of B.
P ( B|A) is the conditional probability of B given A. It is also called the likelihood.
P ( B) is the prior or marginal probability of B, and acts as a normalising constant.
Bayes theorem in this form gives a mathematical representation of how the conditional probability of event A given,
B is related to the converse conditional probability of B given A.
P (A| B) = P (B|A).P (A)/P (B)
Solved Examples
Example 1
In a throw of a coin, fnd the probability of getting a head.
Solution:
Here S= {H, T} and E= {H}
Therefore P (E) = =1/2
Example 2
Two unbiased coins are tossed .What is the probability of getting at most one head?
Solution:
Here, S = {HH, HT, TH, TT}
Let E= event of getting at most one head
E= {TT, HT, TH}
Therefore P (E) = =3/4
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Example 3
An unbiased die is tossed .Find the probability of getting a multiple of 3.
Solution:
Here S= {1, 2, 3, 4, 5, 6}
Let E be the event of getting a multiple of 3.
Then, E= {3, 6}
Therefore P (E) = =2/6 =1/3
Example 4
In a simultaneous throw of a pair of dice, fnd the probability of getting a total more than 7.
Here, n(S) = (6 x 6) =36
Let E= event of getting a total more than 7
={(2,6),(3,5),(3,6),(4,4),(4,5),(4,6),(5,3),(5,4),(5,5),(5,6),(6,2),(6,3),(6,4),(6,5),(6,6)}

P (E) = = =5/12
Example5
A bag contains 6 white and 4 black balls. Two balls are drawn at random. Find the probability that they are of the
same colour.
Let S be the sample space .Then,
n(S)= Number of ways of drawing 2 balls out (6+4)= = 10 x 9 /2 x 1 =45
Let E =event of getting both balls of the same colour. Then,
n(E)=Number of ways of drawing (2 balls out of 6) or (2 balls out of 4)
= 6 +4 = + = (15+6) =21
P (E) = =21/45=7/15

Example 6
Two dice are thrown together. What is the probability that the sum of the numbers on the two faces is divisible by
4 or 6?
Clearly n(S) =6 x 6 =36
Let E be the event that the sum of the numbers on the two faces is divisible by 4 or 6 .Then
E={(1,3),(1,5),(2,2),(2,4),(2,6),(3,1),(3,3),(3,5),(4,2)(4,4)(5,1)(5,3),(6,2),(6,6)}
n (E)=14
Hence P (E) = =14/36 = 7/18
Example 7
Two cards are drawn at random from a pack of 52 cards. What is the probability that either both are black or both
are queens?
Solution:
We have n(S) = 52 = =1326
Let A = event of getting both black cards,
B=event of getting both queens
A B = event of getting queens of black cards.
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n (A) = 26 = (26 x 25)/ (2 x1) =325
n (B) =4 = (4 x 3)/(2 x 1)=6
and n (A B)= 2 =1
P (A) =n(A)/n(S) =325/1326
P (B) =n(B)/n(S) =6/1326
P (A B) = n (A B)/n(S) = 1/1326
Therefore P (A B) =P (A) +P (B)-P (A B)
= (325/1326 + 6/1326 -1/1326) =330/1326=55/221
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Summary
Probability is the method to determine the chance of happening of a particular event in a random experiment.
An operation which can produce some well defned outcomes is called an experiment/event.
Random experiment is the one which gives one or more results under identical conditions. An experiment in
which all possible outcomes are known and the exact output cannot be predicted in advance is called a random
experiment.
The set of all possible outcomes of a random experiment is known as the sample space and every outcome is
a sample point.
Two or more event are said to be mutually exclusive if these events cannot occur simultaneously.
Two or more events are said to be independent if the happening or non-happening of any event does not affect
the happening of others. Events are no way related to each other.
P (E) =
P (B | A) =
In the discrete case, Bayes theorem relates the conditional and marginal probabilities of events A and B, provided
that the probability of B does not equal to zero.
References
Grinstead, C. M. and Snell, J. L., 1997. Introduction of Probability: Probability, AMS Bookstore, pp133-137.
Mosteller, F., 1987. Probability: Probability, 1st ed., Dover Publications.
Prof. Chakraborthy, Introduction to the theory of Probability, [Video Online] Available at: <http://www.youtube.
com/watch?v=r1sLCDA-kNY> [Accessed 31 August 2012].
Penfeld, P., 2010, Probability, [Video Online] <http://www.youtube.com/watch?v=_oBgnTy85fM> [Accessed
31 August 2012].
Fill, J., Journal of theoretical Probability, [Online] Available at: <http://www.springer.com/mathematics/
probability/journal/10959> [Accessed 31 August 2012].
Khan, Probablity, [Online] Available at: <http://www.khanacademy.org/math/probability/v/basic-probability>
[Accessed 31 August 2012].
Waters, D., 2006. Quantitative Methods for Business, Probability, 4th ed., Prentice Hall Publication.
Bedward, D., 1999. Quantitative Methods, Probability, Elsevier.
Slater, J, C., 2007. Quantitative Methods, Probability, Thomson Learning.
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Self Assessment
__________ is the method to determine the chance of happening of a particular event in a random 1.
experiment.
Probability a.
Experiment b.
Event c.
Deterministic d.
An operation which can produce some well defned outcomes is called an _________. 2.
probability a.
experiment b.
event c.
deterministic d.
_________ experiment is the one which gives one or more results under identical conditions. 3.
Deterministic a.
Random b.
Independent c.
Dependent d.
The set of all possible outcomes of a random experiment is known as the _________. 4.
event a.
sample space b.
sample point c.
experiment d.
An event is a __________ of the sample space. 5.
subset a.
set b.
proper subset c.
probability d.
Two or more events are said to be ___________ if the happening or non-happening of any event does affect 6.
the happening of others.
independent a.
mutually exclusive b.
elementary c.
dependent d.
Two or more event are said to be _________ if these events cannot occur simultaneously. 7.
independent a.
dependent b.
mutually exclusive c.
elementary d.
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Two unbiased coins are tossed .What is the probability of getting at most one head? 8.
1/2 a.
1/4 b.
3/4 c.
5/2 d.
An unbiased die is tossed .What is the probability of getting a multiple of 3? 9.
2/3 a.
5/6 b.
1/3 c.
1/6 d.
A bag contains 6 white and 4 black balls. Two balls are drawn at random. What is the probability that they are 10.
of the same colour?
1/15 a.
4/15 b.
2/15 c.
7/15 d.
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Chapter VI
Permutations and Combinations
Aim
The aim of this chapter is to:
introduce the concept of permutation
defne combination
explain the principles of counting
Objective
The objectives of this chapter are to:
explain the fundamental principles of counting
discuss the principle of multiplication
Learning outcome
At the end of the chapter, you will be able to:
understand the permutation operations in different scenario
identify the combination operations in different scenario
understand factorial notation
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6.1 Introduction
Permutation is the method that helps us to determine the number of ways a group of objects can be selected and
then arranged but combination only tells us the number of ways the objects can be selected.
Example: Tossing a coin, placing a ball in a box, rolling a dice selecting a person from a crowd are all physical
processes that have a number of possible outcomes. A ball can be placed in a box in one way, the two possible
outcomes 1,2,3,4,5 and 6,selecting a committee of four from several hundred people has many outcomes. When
considering such physical processes we use permutations and combination to easily arrive at the correct answer.
6.2 Basic Calculation Used
6.2.1 Factorial Notation
the product of frst n natural numbers is denoted by n! and is read as n factorial or factorial n.
by defnition 0! = 1
we can represent n! as; n! = n x (n-1)!
The value of n!=1 x 2 x 3 x ....x n
Suppose we have n x (n-1) x (n-2) x ....x(n-r+1) =
Where r is a natural number less than or equal to n
Illustration
Let us take Represent 10 x 9 x 8 in factorial notation
We have 10! =10 x9x8x7x6x5x4x3x2x1
We have 7! = 7x6x5x4x3x2x1
Therefore 10 x 9x 8 = = =
6.3 Fundamental Principles of Counting
If one thing can be done in m different ways and a second thing can be done in n different ways independent of
the frst ,then either of them can be done in (m+n) different ways.
Example:
If in a toy shop there are 10 different toy guns and 15 different toy dolls. Then the number of ways to select or to
choose a toy from the shop is 10 +15 =25.Because we have to choose a toy, which could be either a toy gun or a
toy doll.
6.3.2 Principle of Multiplication
If one thing can be done in m different ways and a second thing can be done in n different ways, independent of the
frst ,then both the things can be done the things can be done together in (m x n) different ways.
Or
If one task can be divided into 2 sub parts where the frst sub part can be completed in m ways and second sub part
can be completed in n ways then the total number of different ways to complete the task is m x n.
Illustration
If a Person wants to go from Mumbai to Nagpur via Pune, there are 6 different ways to go from Mumbai to Pune
and 6 different ways to go from Pune to Nagpur we can say person has 6 x 6 different ways.
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Route 1
Mumbai
Nagpur
Pune
Route A
Route 2
Route B
Route 3 Route C
Route 4
Route D
Route 5
Route E
Route 6
Route F
From the above fgure ,we can see that a person can go from Mumbai to Nagpur by the following routes:
Route 1-Route A
Route 1-Route B
Route 1-Route C
Route 1-Route D
Route 1-Route E
Route 1-Route F
Similarly by choosing route 2,3,4,5 or 6 different ways for each of the routes thus the total number of different ways
a person can go from Mumbai to Nagpur is 6 x 6 =36 different ways.
Generalization of Fundamental Principle of Counting If n different things can be done in m
1
,m
2
,m
3
,...,m
n
different
ways respectively, independent of each other then
Any one of them can be done in m a.
1
+m
2
+m
3
+...+mn different ways
All of them can be done in the same order in m b.
1
x m
2
x....x m
n
different ways.
6.4 Permutation
Permutation is the number of arrangements of given objects.
Illustration:
If Raj, Ram and Shiv are three people to be seated for a Photograph. The number of ways they can be seated are
Raj, Ram, Shiv
Raj, Shiv, Ram
Ram, Raj, Shiv
Ram, Shiv, Raj
Shiv, Raj, Ram
Shiv, Ram, Raj
Therefore, the total number of arrangements is 6 or 3!
So if there are n people or objects which we have to arrange then the total number of arrangements is n!
Permutations of n distinct objects when only r are taken at a time and arranged in a straight line, then the number
of arrangements is given by n P r or P(n,r),where
n P
r
=
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6.4.1 Basic Forms of Permutations
Following are the basic forms of permuataions
6.4.1.1 All given Objects are Distinct
Number of Permutations when all the given n distinct objects
(r=n) are taken
n P n = = =n! [As 0! =1]
Illustration: All given objects are distinct
7 people are there in a meeting
In how many ways they can sit in a row of 7 chairs
Here all 7 people have to be seated therefore number of arrangement=7! =5040
6.4.1.2 When k cannot be Selected
Permutations of n distinct objects when only r objects are taken at a time and arranged in a straight line such that k
of the given objects is never taken.
Therefore the number of objects left are (n-k) then the the number of arrangements is given by (n-k) P
r
=
Illustration: When K cannot be selected
There are 3 varieties of mangoes(A,B,C),4 different varieties of Apples(D,E,F,G) and 7 different varieties of
grapes(H,I,J,L,M,N).In how many ways we can arrange 5 fruits on a table when G,M,N should not be taken.
In total we have 3 +4+7=14 fruits. (n=14 k=3 because 1 variety of apple, 2 varieties of grapes cannot be taken
and r=5 as we have to arrange 5 fruits.
(n-k) P
r
= = = = =55440
6.4.1.3 When all the given n objects are not distinct
When all the given n objects are not distinct. Out of those n objects p of them are of one kind ,q of them are of
second kind and r of them of third kind and the remaining are distinct objects then number of permutations are
given by
Illustration: When all of the objects are not distinct
When all of the objects are not distinct
There are 3 mangoes, 4 apples and 7 other fruits one of each. In how many ways we can arrange fruits on a table.
In total, we have 3+4+7 =14 fruits (n=14, P=3 mangoes q=4 apples
The number of arrangements is =
6.4.1.4 Circular Permutation
Number of permutations of n distinct objects taken all at a time in a circle is (n-1)!.If the arrangement is not
dependent upon direction i.e. either clockwise or anti-clockwise the arrangements will remain same then the number
of permutations =
Illustration: Circular Permutation
There are 3 people A, B, C.The number of ways they can be seated around a round table. Therefore number of ways
= (n-1)! = (3-1)! =2! =2
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If instead of three people we have 3 beads to make a necklace then the number of arrangements become = =
=1 because if we reverse the necklace then the order 1 is same as 2.Therefore only one arrangement is possible.
6.4.1.5 Repetition is Allowed
If repetition is allowed then the number of permutations for n distinct objects from which r are taken at a time n
r
.
Illustration: Repetition is allowed
In a particular country the pin code for different cities are given by using digits from 1 to 8 and the size of pin code
is 4 digits. Then how many different pin codes are possible.
n=8 and r=4 hence n
r
=8
4
=4096.
6.5 Combination
Combination is the number of selections out of given objects.
Illustration: Combination
If Manish, Harish and Jaideep are three people out of which 2 have to be selected for a photograh.The number of
ways they can be selected are
Manish, Harish
Harish, Jaideep
Manish, Jaideep
The total number of selections is 3 or 3C
2
.
Combination of n distinct objects when only r objects are taken at a time, then the number of selections is given by
nC
r
or C(n,r) where n is the number r is the number of object selected.
General Formula is nC
r
=
6.6 Basic Forms of Combination
6.6.1All Given Objects are distinct
Number of Combination when all the given n distinct objects (r=n) are taken, then
n C
n
= = =1
Illustration:All given objects are distinct
7 people are there in a company.
In how many ways they can be a part of a meeting of 7 People?
Here all 7 people are selected .Therefore number of selections =1
6.6.2 When K objects cannot be selected
Combination of n distinct Objects when only r are taken at a time such that k of the given objects is never taken.
Therefore number of objects left are n-k then the number of selections is given by n-k C
r
=
Illustration: When K objects cannot be selected
There are 3 varieties of mangoes(A,B,C),4 different varieties of apples(D,E,F,G) and 7 different varieties of
grapes(H,I,J,K,L,M,N).In how many ways can 5 fruits be selected when we cannot take G,M,N.
In total we have 3+4+7 =14 fruits. Therefore n=14, k=3 because 1 variety of apple, 2 varieties of grapes cannot be
selected and r=5 as we have to select 5 fruits.
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n-k C r = = = = = 462

6.6.3 When k Objects are always Selected
Combination of n distinct objects when r objects are taken at a time such that k objects are always selected. Then
the total number of selections = n-k C
r-k
Illustration: When k objects are always selected
There are 11 players in a hockey team. In how many ways we can select 5 players for the board meeting if captain
and vice captain have to be there.
Here n=11, k=2 (captain and vice captain),r=5
Total number of way the members for the meeting can be selected = n-k C
r-k
= 11-2 C
5-2
=9 C
3
= =84
6.6.4 Distribution of Objects into two Groups
If there are (m+n) objects and we required to divide them into groups of m and n objects respectively. Then the
number of ways will be m+n C m or m+n C
n
Illustration: Distribution of Objects into two groups
There are 10 people in a company. The company wants to divide them into two teams such that one team has 6
people and the other team has 4 people. With the condition that same person cannot be a part of both the teams and
each person has to be a part of either of the teams.
Number of different ways to select the two teams = m+n C
m
= 6+4 C
6
= =210
Note:
When m= n then the number of ways =
6.6.5 Distribution of Similar Objects
If we have n same objects and want to distribute them amongst r persons then the total number of ways to distribute
them is given by n+r-1 C
r-1
Illustration: Distribution of similar objects
If we have 10 chocolates with us and want to distribute them amongst 4 students then the number of different ways
to distribute them is
= n+r-1 C r-1 where n=10 and r=4
Therefore, n+r-1 C 4-1 =13 C 3=286
Note:
If each of the people is getting atleast one then the number of ways to distribute will be n-1 C r-1
6.6.6 Total possible Combination of n Distinct Objects
If we have n distinct objects, then the total number of ways to select an object or a group of objects from them is
given by 2
n
-1
Illustration: Total possible combination of n distinct objects
If a person has seven friends, in how many ways can he invite one or more of them to attend a tea party?
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He can invite one or two or seven friends in
7C1+7C2+7C3+....+7C7 =2
7
-1=127 ways
6.6.7 When All are not Distinct Objects
If there are p+q+r objects where p are of one type are of second type and r are distinct objects then the number of
ways to select atleast 1 object out of them is (p+1)(q+1)2
r
-1
Illustration: When all are not Distinct Objects
In a library there are 4 science books, 8 mathematics books and 10 books of other different subjects then the number
of ways in which a person can select atleast 1 book from any subject is given by (p+1)(q+1)(2
r
)-1=(4+1) (8+1)2
10

-1 = 5 * 9 * 1024 -1 =46079
6.6.8 When all are Distinct but of Different Kind
If there are p+q+r objects where p are distinct objects of one type ,q are distinct objects of second type and r are
distinct objects of third type then the number of ways to select atleast 1 object of each type out of them is (2
p
-1)
(2
q
-1)(2
r
-1)
Illustration: When all are distinct but of different kind
Suppose if a person has 5 blue shirts of different shades, 3 black trousers of different shades and 4 grey ties of
different shades now in how many he can wear an outft for a party.
Therefore p=5,q=3 and r=4.The number of different ways he can select an outft for the party=(2
5
-1)(2
3
-1)(2
4
-1)
=31 * 7 *15 = 3255.
6.7 Special Case(Permutation and Combination Simultaneously)
If there are n objects we have to arrange r out of those n such that k objects are always selected for the arrangement.
Then total number of arrangements are given by n-k C
r-k
* r!
Illustration:
There are 10 different fruits and we want to arrange 4 fruits on the table such that 2 of them are always on the
table.
We know that n=10 fruits r=4 k=2
The total number of arrangements are given by n-k C r-k * r! = 8 C 2 * 4! =672.
6.8 Basic Manipulation on Permutation and Combinations
n C
n-r
=n C
r
If n C
p
= n C
q
then either p=q or p+q =n
n P
n
= n P
n 1
n P
r
= n C
r
* r!
n P
r
= n-1 P
r
+ r
n-1
P
r-1
n C
r
+ n C
r-1
= n+1 C
r
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Solved Examples
Example 1:
From a pack of 52 cards fnd the number of ways in which
a king or a queen can be drawn a.
both a king and a queen can be drawn b.
Solution & Explanation:
A king can be drawn in 4 different ways; a queen can be drawn in 4 different ways. By fundamental principle of
multiplication a king and a queen can be drawn in 4 x 4 =16 ways.
Example 2:
How many words can be formed with the letters of the word Mathematics? In how many of them do the vowels
occur together?
Solution & Explanation:
Total letters =11, M, A, T occur twice
Total arrangements=11! / (2! 2! 2!)=4989600
Treat the four vowels A, A, E, I as one unit. This with remaining 7 letters of which two are repeated can be arranged
in 8! /2! 2! Ways. Four vowels can be arranged among themselves in 4! /2! Ways.
Therefore Total number of ways = (8! /2! 2!) (4! /2!) =120960
Example 3:
Twenty persons were invited for a party. In how many ways can they and the host be seated at a circular table? In
how many of these ways will two particular persons be seated on either side of the host?
Solution & Explanation:
There are 20 +1 persons to be seated at the table .Fixing the seat of one person the remaining 20 can be seated in
20! ways.
Two particular persons can be sitting on either side of the host in 2! Ways .Remaining 18 can arrange themselves
in 18! Ways.
Therefore the required number = 2! * 18!
Example 4:
Ten different letters are given. Words with fve letters are to be formed from these given letters. Find the number of
words which have at least one letter repeated.
Solution & Explanation:
When there is no repetition of letters,
Total number of words with 5 letters = 10 P
5
=30240
When any letter is repeated any number of times, total number of words =10
5
Therefore required number of words =100000-30240=69760
Example 5
A photograph of 4 players is to be taken from 11 players of a cricket team. How many different photographs can be
taken if in each photograph captain and vice captain
must be included a.
are never included b.
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Solution & Explanation:
Two players can be chosen in 9 C 2 ways
Total number of photographs = 9 C a.
2
* 4! =864
Total number of photographs =9 P b.
4
ways
Example 6
From 5 different green balls, four different blue balls and three different red balls, how many combinations of balls
can be chosen taking atleast one green and one blue ball?
Solution & Explanation:
At least one green ball can be chosen from fve green balls in 2
5
-1=31 ways
At least one blue ball can be chosen from four blue balls in 2
4
-1 =15 ways
At least one or no red ball can be chosen in 2
3
=8 ways
Therefore by generalization of fundamental principle, required number of ways =31 * 15 *8 =3720
Example 7
From 3 pears, 4 oranges and 5 apples, how many selections of fruits can be made by taking
at least one of them i.
at least one of each kind ii.
Solution & Explanation
Out of 3 pears, we may take either 0 or 1 or 2 or 3 .Thus pears can be chosen in 4 different ways .Similarly, iii.
oranges in 5 and apples in 6 ways. Number of ways of selection of fruits =4 *5*6 =120.But this also includes
the case when no fruit is taken. Rejecting this case, the required number of ways=120-1=119.
At least one pear is to be chosen, we may take either 1, 2 or 3 pears. Thus pears can be chosen in 3 different iv.
ways. Oranges can be chosen in 5 different ways. Apple can be chosen in 5 different ways
Therefore total number of ways = 3 * 4 * 5=60
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Summary
Permutation is the method that helps us to determine the number of ways a group of objects can be selected and
then arranged but combination only tells us the number of ways the objects can be selected.
n P
r
=
Permutations of n distinct objects when only r objects are taken at a time and arranged in a straight line such
that k of the given objects is never taken.
(n-k) P
r
=
When all the given n objects are not distinct. Out of those n objects p of them are of one kind ,q of them are
of second kind and r of them of third kind and the remaining are distinct objects then number of permutations
are given by
Number of permutations of n distinct objects taken all at a time in a circle is (n-1)!
Combination is the number of selections out of given objects. General Formula is nC
r
=
Combination of n distinct Objects when only r are taken at a time such that k of the given objects is never taken.
Therefore number of objects left are n-k then the number of selections is given by n-k C
r
=
If we have n distinct objects, then the total number of ways to select an object or a group of objects from them
is given by 2
n
-1.
References
Kumar, K. R., 2005. Discrete Mathematics, Permutation and Combination, Firewall Media, p23-47.
Rao, G. S., 2002 . Discrete Mathematical Structure, Permutation, New Age International, pp14-54.
Nix, R., Probability, Combinations and Permutations, [Online] Available at: < http://www.chem.qmul.ac.uk/
[Accessed 31 August 2012]
Kirthivasan, K., Permutation and combination, [Video Online] Available at: < http://www.youtube.com/
watch?v=Dsi7x-A89Mw> [Accessed 31 August 2012].
IIT JEE, Permutation and combination, [Video Online] Available at: < http://www.youtube.com/
watch?v=b8mvJm1vvdQ> [Accessed 31 August 2012].
Waters, D., 2006. Quantitative Methods for Business, Permutation and Combination, 4th ed., Prentice Hall
Publication.
Bedward, D., 1999. Quantitative Methods, Permutation, Elsevier.
Slater, J, C., 2007. Quantitative Methods, Combination, Thomson Learning.
Quantitative Techniques
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Self Assessment
________ is the number of arrangements of given objects. 1.
Permutation a.
Combination b.
Factorial c.
Selection d.
__________ is the number of selections out of given objects. 2.
Permutation a.
Combination b.
Factorial c.
Selection d.
__________ is the method that helps us to determine the number of ways a group of objects can be selected 3.
and then arranged.
Permutation a.
Combination b.
Factorial c.
Selection d.
__________ only tells us the number of ways the objects can be selected. 4.
Permutation a.
Combination b.
Factorial c.
Selection d.
There are 3 varieties of mangoes(A,B,C),4 different varieties of Apples(D,E,F,G) and 7 different varieties of 5.
grapes(H,I,J,L,M,N).In how many ways we can arrange 5 fruits on a table when G,M,N should not be taken?
22330 a.
33440 b.
44550 c.
55440 d.
In how many ways they can be a part of a meeting of 7 People? 6.
5040 a.
3040 b.
2040 c.
1040 d.
There are 11 players in a hockey team. In how many ways we can select 5 players for the board meeting if 7.
captain and vice captain have to be there.
81 a.
80 b.
83 c.
84 d.
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7 people are there in a company. In how many ways they can be a part of a meeting of 7 People? 8.
7! a.
7 b.
5040 c.
1 d.
From 5 different green balls, four different blue balls and three different red balls, how many combinations of 9.
balls can be chosen taking atleast one green and one blue ball?
3120 a.
3720 b.
3520 c.
3420 d.
From a pack of 52 cards in how many number of ways in which a king or a queen can be drawn? 10.
2 a.
1 b.
4 c.
3 d.
Quantitative Techniques
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Chapter VII
Interpolation
Aim
The aim of this chapter is to:
defne interpolation
introduce the applications of interpolation
describe the importance of interpolation
Objectives
The objectives of this chapter are to:
explain the different methods of interpolation
elucidate Newton-Gauss forward and backward method
explicate the graphical method of interpolation
Learning outcome
At the end of this chapter, you will be able to:
understand the need for interpolation
identify the Newtons method of advancing differences
comprehend Lagranges method for calculation interpolation
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7.1 Introduction
Interpolation is the method of statistical estimation and the word literally means making insertions. Simply
interpolation is understood by following example;
If we need to know the population of our country, for any intermediary year, says 1985, one logical approach would
be to work forward from the population of 1981, by adding births and infow of the people into the country and
deducting deaths and outfow of people from the country during 1981-1985.
Thus the data on population of the year 1985 is required, 100% accurate fgures are really not required.
7.2 Defnition of Interpolation
Interpolation may be defned as the technique of obtaining the most likely estimates of certain quantity under
certain assumptions. - D.N. Elhance
Interpolation is a statistical device used to estimate the most likely fgure under certain assumptions within the
given limits
Interpolation provides us the missing quantity of a series so that we can establish the while extrapolation are
the techniques of obtaining the most likely estimates of certain quantity under certain assumptions
Interpolated fgures are not perfect substitutes of the original fgures. They are only best possible substitutes
on certain hypothesis
7.3 Application
Interpolation is widely used by businessmen, administrators, sociologists, economist and fnancial analysis.
It helps in completing the incomplete, lost or destroyed records.
Eg. In fnancial analysis the interpolation used to fnd out the IRR(internal rate of return) of a project, all
investment decisions which require to use of the Present value and future value interest factor tables.
7.4 Need and Importance of Interpolation
Sometimes it is not possible to collect the whole data about the problem under study. Even if it were possible
to collect the whole data it may not be worthwhile to do so due to a large amount of expenditure involved or due
to organisational diffculties
Technique of interpolation can be used for making best estimates, at the least cost
These estimates will be a more useful fgure than rough estimates
To estimate intermediate value
In certain cases data is collected after long intervals
For example; in India the census of population is collected after every ten yrs
The technique of interpolation will be needed to estimate the fgure of population for intermediate years
Lost data
Sometimes the data is lost due to fre, earthquake etc. The interpolation technique is help to fll the gaps in
statistical information due to lost data
Uniformity ofsata
Statistics concerning a particular phenomenon are collected by different agencies, it destroys its
uniformity.
In such cases comparison of data becomes diffcult. So to establish uniformity of data, the techniques of
interpolation is used.
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Forecasting
The forecasting activity regarding data is practical utility for economic planning, policy formulation, production
decisions etc
7.5 Methods of Interpolation
Different methods of interpolation are explained below.
7.5.1 Graphical Method
It is simplest method of Interpolation.
In this method the data is represented in graph, i.e. on X-axis all independent variables and on Y-axis all
dependent variables are taken.
The curve is formed after joining the points, this curve give interrelation between two variables.
From the point of X-axis, for which the value of y is to be interpolated, a line parallel to Y-axis will be drawn.
From the point where this line will cut the curve, a line parallel to X-axis will be drawn, here the value of y will
be found from the point where the line cuts Y-axis, this is called Interpolated fgure or Value
7.5.2 Newtons method of advancing differences
This method is applicable for the following cases
The independent variable advances by equal intervals
The value to be interpolated is different from the equidistant value
The value to be interpolated lies in the beginning of the data
This method is known as fnite or advancing differences method because after fnding out differences in the
values of y, the process is extended further till only one difference remains
We also taken into consideration that the +ve and -ve sign while calculating the differences
7.5.3 Lagranges Method
Lagranges interpolating polynomial is another very good formula for interpolation
This method has no restriction on the x-variable whether it should be equally spaced or not
This method can be used for any value of x either for interpolation
It is also to estimate the argument of x for given value of y, it means the Lagrange;s formula can be used for inverse
interpolation also.The only demerit of Lagranges formula is that, it required heavy computational work
7.5.4 Newton-Gauss Forward Method
It is method which is used in particular situation. It is used when the independent variable (a) advance by equal
intervals (b) the value to be interpolated falls in the middle of the series.
The formula is as under;
Gauss Forward Formula is
f
p
=f
0
+p
1/2
+G
2

0

2
+G
3

1/2

3
+....
for p [0,1],where is the central difference and G
2n
=
G
2n+1
= where is the binomial coeffcient
79/uts
7.5.5 Newton-Gauss Backward Method
This is also known as Newton Gregory backward formula
Its applicability is described below
When the argument x advances with the equal jumps
When the x-value to be interpolated lies near the end of the series
Diagonal difference table is used in Newtons backward formula, but the differences are used in reverse
order.
Quantitative Techniques
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Summary
Algebraic expressions in which the variables concerned have only non-negative integral exponents are called
polynomials
The standard form of a polynomial in one variable is that in which the terms of the polynomial are written in
the decreasing order of the exponents of the variable
Interpolation provides us the missing quantity of a series so that we can establish the while extrapolation are
the techniques of obtaining the most likely estimates of certain quantity under certain assumptions
Methods of Interpolation are Graphical method, Lagranges Method, Newton-Gauss Forward Method, Newtons-
Gauss Backward method. etc.
Lagranges interpolating polynomial is another very good formula for interpolation
This method has no restriction on the x-variable whether it should be equally spaced or not
Gauss Forward Formula is
f
p
=f
0
+p
1/2
+G
2

0

2
+G
3

1/2

3
+....
References
Jain, T. R.. and Sandhu, A. S., 2006-07, Quantitative Methods: Interpolation, VK Publication, pp 7.1-7.38.
Agarwal, B. R., 2007. Programmed Statistics, Interpolation, 2nd ed., New Age International, pp 405-425.
Kumar, S., 2008, Polynomial Interpolation, [Video Online] Available at: < http://www.youtube.com/
watch?v=Oy3uudRXolE > [Accessed 31 August 2012].
Kumar, S., Numerical Methods and Programming, [Video Online] Available at: < http://www.youtube.com/
watch?v=ZG_TgdyDrf0 > [Accessed 31 August 2012].
Interpolation , [Online] Available at: < http://www.mathworks.com/moler/interp.pdf > [Accessed 31 August
2012].
Bourke, P., Interpolation methods, [Online] Available at: < http://paulbourke.net/miscellaneous/interpolation/
> [Accessed 31 August 2012].
Waters, D., 2006. Quantitative Methods for Business, Interpolation, 4th ed., Prentice Hall Publication.
Bedward, D., 1999. Quantitative methods, Interpolation, Elsevier.
Slater, J, C., 2007. Quantitative Methods, Interpolation of Polynomials, Thomson Learning.

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Self Assessment
Graphical Interpolation method is_____. 1.
Simple a.
Algebrical b.
Fully reliable c.
Reliable d.
Interpolation is helpful in estimating: 2.
A series a.
An intermediary value of given argument b.
Entry of alternative values c.
A series of value d .
Lagrange Formula is useful for _____ 3.
Interpolation a.
Arithmetic functions b.
Inverse range c.
Inverse extrapolation d.
Lagranges polynomials interpolation can be used even if; 4.
The given arguments are not equally spaced a.
Extrapolation is to be done b.
Inverse interpolation is to be done c.
Relation to be mapped d.
Interpolation formulae are based on the fundamental assumptions that the data can be expressed as; 5.
A linear function a.
A polynomial function c.
A binomial function d.
The problems of interpolation are simpler than prediction because; 6.
Interpolation has fewer restrictions than prediction a.
Interpolation is based on more stringent restriction than prediction b.
There are no restriction than interpolation c.
It is easier to fnd out d.
________ is simplest method of Interpolation. 7.
Graphical method a.
Langranges method b.
Interpolation method c.
Inverse method d.
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In which method the data is represented in graph? 8.
Langranges method a.
Interpolation method b.
Inverse method c.
Graphical method d.
The value to be interpolated is different from the ______ value. 9.
equivalent a.
equal b.
equidistant c.
equillibrium d.
_________ provides us the missing quantity of a series. 10.
Interpolation a.
Graphical method b.
Lagranges method c.
Newtons method d.
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Chapter VIII
Consumer Arithmetic
Aim
The aim of this chapter is to:
defne proft and loss
explicate interest
explain recurring deposit
Objectives
The objectives of this chapter are to :
discuss types of interest
elucidate present worth
describe the concept of discount
Learning outcome
At the end of this chapter, you will be able
understand import terms in proft and loss
compare simple and compound interest
underst and discount
Quantitative Techniques
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8.1 Introduction: Proft and Loss
In olden days every one produced or made what they needed. In case there was an excess produced I was an excess
produced it was exchanged with others for mutually required goods. The exchange was need based. The system was
known as barter. However, as time passed people found it was better to take produce/goods from a person who
was good at producing them.Thus, the system of exchange of goods and services for money began. The introduction
of the monetary system gave rise to the concept of gain or loss in the exchange and thus concept of proft and loss
was born.
Example
A pair of shoes has been bought by the shopkeeper from a cobbler. The cobbler had sold the shoes to the shopkeeper for
Rs.150.To make the shoes the cobbler had spent Rs.100 on raw material. The shopkeeper spent Rs.20 on transporting
the pair of shoes from the cobbler to the shop. The shopkeeper had also bought a box of Rs 5 as packaging for the
pair of shoes. The shopkeeper fxes the price for those shoes as Rs.300 and a customer purchases it after bargaining
for Rs.250.
The price at which the goods are sold is known as selling price (SP). In the above example Rs.150 is the selling
price for the cobbler and Rs.250 is the selling price for the shopkeeper.
The price at which the goods are bought is known as cost price(CP). In the above example the cost price for
the shopkeeper is 175(cost paid to the cobbler+transportation+packaging), while Rs.250 is the cost price for
The cost occurred in relation to the goods apart from the actual cost of the goods is known as overhead charges.
In the above example the overhead charges is Rs.25.(Cost of transportation Rs.20+cost of Packaging Rs.5)
If selling price is more than the cost price, then it is said the seller has made a proft/gain. In the above example
the proft for the cobbler is Rs.50 (selling price of the cobbler raw material cost for the cobbler).The proft for
the shopkeeper is Rs.75 (selling price of Rs.250-cost price of Rs 175).
If the selling price is less than the cost price ,then it is said the seller has made a loss. In the above example if
the shopkeeper had sold the shoes for Rs150 ha would have made a loss(cost price of Rs 175 Selling Price
of Rs.150)
The price at which the goods are intended to be sold is known as marked price. In the above example Rs.300 is
the marked price of the shoes .Marked price is also known as the List price or quoted price.
When the Selling price is lesser than the marked price, it is said that the seller has given a discount.In the above
example the customer has given a discount of Rs.50 (marked price of Rs.300-selling price of Rs 250).This
discount is also known as trade discount.
The price at which the goods are sold after discount is known as net price. In the above example the net price
is Rs.250.
8.1.1 Formulae
Proft = selling price cost price
Loss = cost price selling price
Gain%=(Gain/cost price)* 100
Loss%=(Loss/cost price)*100
If the cost price and gain is given then selling price = [(100+gain%)*cost price]/100
If the cost price and Loss% is given the selling price =[(100-loss%)*cost price]/100
If the selling price and gain% is given that cost price= (100*selling price)/ (100+gain %)
If the selling price and loss% is given then cost price = (100*selling price)/ (100-loss %)
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The points to remember are as follows:
If the marked price is different from the selling price, then the proft/loss is calculated on the selling price.
Percentage gain or loss is calculated on the cost price and not the selling price.
Proft or loss on Rs 100(cost price) is called proft or loss Percent age respectively.
Proft is also referred to as gain
Discount is always given on the market price.
8.2 Interest
Interest is a fees paid by a borrower of assets to the owner of the assets as form of compensation for the use of assets.
It is most commonly the price paid for the use of money or money earned by the deposited funds.
Illustration:
When we give our house for someone to live in we get a rent and we get the house back after completion of the
lease tenure, similarly when we lend our money to someone we get interest and after completion of the tenure we
get our money back.
8.2.1 Terms Used
When a person borrows money he has to pay some extra amount to the lender for using his money. The extra
money paid to the lender is known as Interest.
The money that is initially borrowed/lent/invested is known as Principle.
The total sum of principle and interest is known as Amount.
The percentage gain in principle is known as Rate of interest.
The tenure for which the principle is borrowed/lent/invested is known as Time period.
8.2.2 Simple Interest
Simple interest is where the interest is paid to the investor/lender as and when it is due. Only principle is reinvested/
renewed.
8.2.2.1 Formulae
Let P=Principle
A=Amount
R=Rate of Interest
T=Time period
I=Interest
S.I=Simple Interest
Then
S.I = (P*R*T)/100
P= (100*S.I)/(R*T)
R= (100*S.I)/ (P*T)
T= (100*S.I)/ (P*R)
The points to remember are as follows:
For simple interest time period is always calculated in years. If the time period is given in months then it has
to be converted into years.
To convert time period from months to year divide the time period by 12 to get the time period in years. Example
if the amount has been given for 5 months then the time period is 5/12 years.
Rate of interest unless specifed is taken as one year.
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8.2.3 Recurring Deposit
Recurring deposit is a deposit in which fxed sum of money is deposited at a regular interval for a specifed period.
After the fxed period is over,the depositor gets his full money back and an interest.
The points to remember are as follows:
A recurring scheme is like a piggy bank where you deposit small sums of money at fxed intervals to get a
consolidated amount at the end of the scheme.
In a recurring scheme the interest is calculated per interval(monthly,half yearly,annually etc..) at a fxed rate.
In a recurring deposit ,interest and the total amount accumulated is given at the end of the scheme period.
In the recurring deposit the amount deposited for the 1
st
month will get an interest for the fxed period say n
months.The amount deposited for the 2
nd
month will get interest for (n-1) months and so on.
8.2.3.1 Formulae
Total principle at maturity=Recurring amount x {n(n+1)/2} where n is the period for which the 1
st
installment
is deposited
Simple Interest =
The time period is calculation is taken as 1 month as we have already normalized the principle and hence
t=1/12
Total amount at the end of the scheme =Total principle at maturity + interest
8.2.4 Compound Interest
Compound Interest is where the interest is not paid to the investor/lender as and when it is due but is added to the
principle at the end of the time period agreed upon. The interest is added to the principle and that becomes the
principal for the next tenure.
8.2.4.1 Formulae
Let P =Principle
A=Amount
R=Rate of Interest
T=Time period
N=Number of times the interest is due in a year
I=Interest
C.I=Compound Interest
Then
Amount= P[1+R/100]
NT
C.I =Amount Principle
Present Worth=A/[1+R/100]
T
Present worth is nothing but the principle invested
Condition 1: Principal = Rs p, time =t years and rate =r% and number of times the interest is due in 1 year =1.
Then the amount after t years is = p[1+r/100]
1*t
Condition 2: Principle =rs p; time =t years and a fraction of year[Ex 5 2/5 years] and number of times the interest
is due in 1 year =1.Then the amount after 5 2/5 years = [p(1+r/100)
1*5
](1+2r/5*100)
For the fraction of the year the rate will be rate per annum * fraction of year
Condition 3:Principle =Rs p,Time=t years and rate =r% p.a and number of times the interest is due in 1 year
=3.Then amount after t years is
=p [1+r/ (3x100)]
3*t
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Similarly, principal=Rs.p, Time =t years and rate =r% p.a and number of times the interest is due in 1 year =2
Then amount after t years is =p[1+r/(2 x 100)]
2 * t
Condition 4: Principle = Rs p, Time = t years and rate =r
1
% for the frst year, r
2
% for the second year.
r
t
% for the t
th
year. The amount after t years is = p(1+r
1
/100)(1+r
2
/100)(1+r
3
/100)(1+r
t
/100)
The points to be remembered are as follows:
For compound interest time period is always calculated in y years.If the time period is given in months then it
has to be converted into years.
Rate unless specifed is always for a year
If the interest is computed more than once in a year then,rate r =rate per annum ( R ) /number of times interest
is computed in a year ( N ).
If a sum P is borrowed at r% per annum and compound interest is calculated quarterly or half yearly,then the
compound interest for 1 year is called the effective annual rate.
The amount at the end of a certain time period increases as the number of times the compound interest is
calculated in a year increases i.e if two people put the same principle for the same time period on compound
interest but ,one computed interest half yearly and the other yearly then the person who is getting interest half
yearly and the other yearly then the person who is getting interest half yearly will get more amount at the end
of the tenure.
Solved Examples
Example 1
A man sells a pen at a proft of 20% .Had he bought it at 20% less and sold it for Rs 5 less,he would have gained
25% .What is the CP of the pen?
Solution:
Let the CP be Rs 100; given Gain=20% therefore SP =120
New CP=20% less=Rs 80
If gain is 25%, then SP= Rs (125*80)/100=Rs 100
Therefore if the difference in SP =Rs (120-100)=Rs 20
If the difference in SP is Rs 20, CP is Rs 100
If the difference in SP is Rs 5, CP is
Rs (100*5/20) =Rs 25
Example 2
If the SP of 10 articles is the same as the CP of 11 articles, fnd the gain percent.
Solution
Let the CP of 1 article be Re.1
Therefore CP of 10 articles=Rs 10
SP of 10 articles= CP of 11 articles = Rs 11
Therefore gain%=(11-10) x 100/10 =10%
Example 3
A man loses 10% by selling a book for Rs 144.What should be his selling price to gain 15?
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Solution
SP=Rs 144 loss=10%
Therefore CP=Rs(100 *144)/(100-10)=Rs.160
Gain expected = 15%
Therefore SP=Rs(115*160)/100=Rs184
Example 4
A man sells two radios for Rs 924 each. On one he gains 12% and on the other he loses 12%.How much does he
gain or lose on the whole?
Solution:
SP of one radio =Rs 924 Gain=12%
CP of this radio=Rs (100*924)/112=Rs 825
SP of other radio = Rs 924 Loss=12%
CP of this radio = Rs (100*924)/88=Rs 1050
Total CP=Rs (825+1050) =Rs 1875,
Total SP= Rs (924+924) =Rs 1848
Therefore Loss% = (27 *100)/1875=1.44%
Example 5
What will be the simple interest on Rs 625 at 6.5% per annum for 2.5 years?
Solution
S.I=Rs (625 *6.5 * 2.5)/100=Rs.101.56
Example 6
A man borrowed Rs 2500 from two money lenders.He paid interest at the rate of 12% per annum for one loan and
at the rate of 14% per annum for other .The total interest he paid for the entire year was Rs.326.How much did he
borrow at each rate?
Solution
Let he borrow Rs X at 12% and Rs (2500-x) at 14% p.a
S.I on Rs x= Rs (x)(12)(1/100) = Rs 3x/25
S.I on Rs(2500-x)=Rs (2500-x)(14)(1/100)
=Rs (17500-7x)/50 therefore x=Rs 1200 Thus ,he borrows Rs 1200 at 12% and 1300 at 14%.
Example 7
Find the compound interest on Rs 4000 for 9 months at 6% per annum,the interest being reckoned i)Quarterly ii)
Half yearly
Solution
Principle =Rs 4000, Time =9 months=3 quarters rate=6% per annum =6/4=3/2 % per quarter. Therefore i.
Amount=Rs[4000 x {1+(3/2)/100}
3
]=4182.71
Compound interest = Rs (4182.71-4000) =182.71
Principle=Rs 4000 Time = 9 months =1.5 half years rate= 6% per annum =3% half yearly ii.
Therefore amount Rs[4000(1+3/100){1+3/2)/100}]=Rs 4181.80
Compound interest =Rs(4181.80-4000=Rs181.80
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Summary
The price at which the goods are sold is known as selling price (SP).
The price at which the goods are bought is known as cost price(CP).
If selling price is more than the cost price, then it is said the seller has made a proft/gain.
If the selling price is less than the cost price ,then it is said the seller has made a loss.
The price at which the goods are intended to be sold is known as marked price.
When the Selling price is lesser than the marked price ,it is said that the seller has given a discount.
Proft = selling price cost price
Loss = cost price selling price
Gain%=(Gain/cost price)* 100
Loss%=(Loss/cost price)*100
Interest is a fees paid by a borrower of assets to the owner of the assets as form of compensation for the use of
assets.
Simple interest is where the interest is paid to the investor/lender as and when it is due. Only principle is
reinvested/renewed.
S.I = (P*R*T)/100
Recurring deposit is a deposit in which fxed sum of money is deposited at a regular interval for a specifed
period.
Compound Interest is where the interest is not paid to the investor/lender as and when it is due but is added to
the principle at the end of the time period agreed upon.
Amount= P[1+R/100]
NT
C.I =Amount Principle
References
Veena, G. R., 2006. Business Mathematics, Commercial Arithmetic, New Age International Publishers.
Aggarwal, R. S., 2008. Quantitative Methods, S.Chand Publications.
arithmetic.html?id=CCBRAAAAYAAJ&redir_esc=y > [Accessed 31 August 2012].
Krisch, A ., An Analysis of commercial Arithmetic, [Online] Available at: < http://www.springerlink.com/content/
k8537j674x3w0031/ > [Accessed 31 August 2012].
Kumar, S., 2008, Polynomial Interpolation, [Video Online] Available at: < http://www.youtube.com/
watch?v=Oy3uudRXolE > [Accessed 31 August 2012].
Kumar, S., Numerical methods and programming, [Video Online] Available at: < http://www.youtube.com/
watch?v=ZG_TgdyDrf0 > [Accessed 31 August 2012].
Moore, J. H., 2008. New Commercial Arithmetic, Bibliobazaar LLC.
Morgan, A. D., 1900. Elements of Arithmetic, Taylor and Walton.
Calder, F., 1852. Elementary Rules of Arithmetic.
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Self Assessment
The price at which the goods are sold is known as _______. 1.
selling price a.
cost price b.
marked price c.
net price d.
The price at which the goods are bought is known as ______. 2.
selling price a.
cost price b.
marked price c.
net price d.
The price at which the goods are intended to be sold is known as ___________ . 3.
selling price a.
cost price b.
marked price c.
net price d.
When the Selling price is lesser than the marked price ,it is said that the seller has given a ______ . 4.
proft a.
discount b.
loss c.
gain d.
If the selling price is less than the cost price ,then it is said the seller has made a _____. 5.
proft a.
discount b.
loss c.
gain d.
A man sells a pen at a proft of 20% .Had he bought it at 20% less and sold it for Rs 5 less, he would have gained 6.
25% .What is the CP of the pen?
20 a.
22 b.
23 c.
25 d.
If the SP of 10 articles is the same as the CP of 11 articles, what is the gain percent? 7.
7 a.
10 b.
9 c.
8 d.
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What will be the simple interest on Rs 625 at 6.5% per annum for 2.5 years? 8.
101.56 a.
102.56 b.
103.56 c.
104.56 d.
What is the compound interest on Rs 4000 for 9 months at 6% per annum,the interest being reckoned 9.
Quarterly?
181.70 a.
182 b.
182.71 c.
183 d.
_________ is a fees paid by a borrower of assets to the owner of the assets as form of compensation for the 10.
use of assets.
SI a.
CI b.
Recurring c.
Interest d.
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Chapter IX
Relations and Functions
Aim
The aim of this chapter is to:
defne function
introduce the mathematical concept of relation
highlight the domain of a relation
Objectives
The objectives of this chapter are to:
explain the range of a relation
elucidate the concept of range, image and co-domain
explicate the break even analysis
Learning outcome
At the end of this chapter, you will be able to:
understand the formula for calculating the total cost
comprehend different ways to write a relation
undersatnd the functi on notation
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9.1 Relation
A relation is just a set of ordered pairs. There is absolutely nothing special at all about the numbers that are in a
relation.
In other words, any bunch of numbers is a relation so long as these numbers come in pairs. In maths Relation is just
a set of ordered pairs.
Note: {} is the symbol for SET. Example: {(0, 1), (55, 22), (3,-50)}
9.2 Domain and Range of a Relation
The Domain is the set of all the frst numbers of the ordered pairs.
In other words, the domain is all of the x-values.
The Range is the set of the second numbers in each pair, or the y-values.
Example: if Relation is {(0, 1), (55, 22), (3,-50)}, then
Domain is {0 55 3} Range is {1 22 -50}
NOTE: when writing the domain and range, do not repeat the values

Relation can be written in several ways;
Ordered Pairs
Table
Graph/mapping.
Examples:
What is the domain and range of the following relation?
{(-1, 2), (2, 51), (1, 3), (8, 22), (9, 51)}
Ans:
Domain: -1, 2, 1, 8, 9
Range: 2, 51, 3, 22, 51
What is the domain and range of the following relation?
{(-5,6), (21, -51), (11, 93), (81, 202), (19, 51)}
Ans:
Domain: -5, 21, 11, 81, 19
Range: 6, -51, 93, 202, 51
9.3 Functions
A function is a relationship between two sets of numbers.
We may think of this as a mapping; a function maps a number in one set to a number in another set. Notice that a
function maps values to one and only one value.
Two values in one set could map to one value, but one value must never map to two values: that would be a
relation, not a function.
Example
If we write (defne) a function as:
f(x) = x
2
then we say: f of x equals x squared and we have,
f( - 1) = 1 f(1) = 1 f(7) = 49
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f(1 / 2) = 1 / 4
f(4) = 16 and so on.
9.3.1 Range, image, co-domain
If D is a set, we can say,
, which forms a new set, called the range of f.
D is called the domain of f, and represents all values that f takes. In general, the range of f is usually a subset of a
larger set.
This set is known as the co-domain of a function.
Example: With the function f(x) = cos x, the range of f is [-1, 1], but the co-domain is the set of real numbers.
Notations
When we have a function f, with domain D and range R, we write: If we say that, for instance, x is mapped
to x
2
Notice that we can have a function that maps a point (x, y) to a real number, or some other function of two
variables.
We have a set of ordered pairs as the domain.
Recall from set theory that this is defined by the Cartesian product. If we wish to represent a set of
all real-valued ordered pairs we can take the Cartesian product of the real numbers with itself to obtain
.
When we have a set of n-tuples as part of the domain, we say that the function is n-ary (for numbers n=1,2 we say
unary, and binary respectively).
9.4 Break Even Analysis
Break-even analysis is a technique widely used by production management and management accountants.
It is based on categorising production costs between those which are variable (costs that change when the
production output changes) and those that are fxed (costs not directly related to the volume of production).
Total variable and fxed costs are compared with sales revenue in order to determine the level of sales volume, sales
value or production at which the business makes neither a proft nor a loss (the break-even point).
In its simplest form, the break-even chart is a graphical representation of costs at various levels of activity shown
on the same chart as the variation of income (or sales, revenue) with the same variation in activity.
The point at which neither proft nor loss is made is known as the break-even point and is represented on the
chart below by the intersection of the two lines:
NOTE: The Break Even point is the point where the revenue from sales is equal to the cost of production.
For Calculating Total cost, we should know that,
Proft (P) = Revenue (R) Cost (C).
Where,
Total Cost = Fixed cost + Variable Cost.
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Summary
A relation is just a set of ordered pairs. There is absolutely nothing special at all about the numbers that are in
a relation.
In other words, any bunch of numbers is a relation so long as these numbers come in pairs.
The Domain is the set of all the frst numbers of the ordered pairs, and the Range is the set of the second
numbers in each pair, or the y-values.
A function is a relationship between two sets of numbers.
Two values in one set could map to one value, but one value must never map to two values: that would be a
relation, not a function.
Break-even analysis is a technique widely used by production management and management accountants.
References
Jain, T. R., Quantitative Methods, 2nd ed., FK Publication.
Waters, D., 2006. Quantitative Methods for Business, 4th ed., Prentice Hall Publication.
Author Stream, Relation and Functions [Online] Available at: <www.authorstream.com/.../sadamava-373982-
2-1-relations-functions-ppt-relationsfunctions-powerpoint-education />. [Accessed 31August 2012].
Prof.Kamla, Discrete Mathematics, [Video Online] Available at: < http://www.youtube.com/watch?v=7cTWea9YAJE
> [Accessed 31 August 2012].
Simonson, S., Discrete Mathematics, [Video Online] Available at: < http://www.youtube.com/watch?v=_
FG9hhiZipo > [Accessed 31 August 2012].
Waters, D., 2006. Quantitative Methods for business, 4th ed., Prentice Hall Publication.
Bedward, D., 1999. Quantitative methods, Elsevier.
Slater, J, C., 2007. Quantitative Methods, Thomson Learning.

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Self Assessment
What is the domain of the following relation? 1.
{(-1, 2), (2, 51), (1, 3), (8, 22), (9, 51)}
{-1,2,1,8,9} a.
{2,51,3,22,51} b.
{-1,2,51,1,3} c.
{1,3,8,22,9} d.
What is the range of the following relation? 2.
{(-5, 6), (21, -51), (11, 93), (81, 202), (19, 51)}
{-5,21,11,81,19} a.
{6,-51,93,202,51} b.
{-1,2,51,1,3} c.
{1,3,8,22,9} d.
Which 3. relations below are functions?
Relation #1 {(-1, 2), (-4, 40), (1, 2), (8,-51)} a.
Relation #2 {(13, 14), (13, 5) , (16,7), (18,13)} b.
Relation #3 {(3, 90), (4, 54), (6, 71), (8, 90)} c.
Relaton #4 {(1,3)(2,4)(2,5)(3,4)} d.
Which 4. relations below are functions?
Relation #1 {(3,4), (4,5), (6,7), (8,9)} a.
Relation #2 {(3,4), (4,5), (6,7), (3,9)} b.
Relation #3 {(0,4), (4,-5), (0,0), (8,9)} c.
Relation #4 {(8, 11), (34,5), (6,17), (8,19)} d.
Which 5. relations below are functions?
Relation #1 {(3,4), (4,5), (6,7), (3,-9)} a.
Relation #2 {(3,4), (4,5), (6,7), (5,4)} b.
Relation #3 {(0,4), (4,-5), (0,0), (8,9)} c.
Relation #4 {(8, 11), (34,5), (6,17), (6,19)} d.
For the following relation to be a function, 6. X cannot be what values?
{(8, 11), (34,5), (6,17), (X ,22) }
a. 8, 34, 6
b. 11, 5, 17
c. 8, 34, 6, 11, 5, 17, 22
d. 8, 34, 6, 11, 5, 17
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For the following relation to be a function, 7. X cannot be what values?
{(12,14), (13,5) , (-2,7), (X,13)}
12, 13, -2 b. 14, a.
5,7,13 b.
c. 12, 13,-2, 14, 5,7,13 c.
d. 12,13,-2,14,5,7 d.
For the following relation to be a function, 8. X cannot be what values?
{(12, 13), (-11, 22), (33, 101), (X ,22)}
12, -11, 33 a.
13, 22, 101 b.
12, -11, 33, 13, 22, 101, 22 c.
12, 33 d.
Suppose the weights of four students are shown in the following table. 9.
Student 1 2 3 4
Weight 120 100 150 130
Find domain
{1, 2, 3, 4} a.
{120,100,150,130} b.
{2,3,4} c.
{1,3,5} d.
10.
udent 1 2 3 4
Weight 200 190 100 100
Find Range.
{200,190,100,100} a.
{200,100} b.
{200.190} c.
{200.190.100} d.
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Chapter X
Statistics
Aim
The aim of this chapter is to:
defne statistics
introduce the concept of classifcation
explain the applications of statistics
Objectives
The objectives of this chapter are to:
explain the functions of statistics
explicate the limitations of statistics
elucidate the frequency distribution
Learning outcome
At the end of this chapter, you will be able to:
understand the characteristics of statistics
comprehend the characteristics of classifcation
enlist the characteristi cs of classifcation
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10.1 Introduction
Statistics can be referred as a subject that deals with numerical facts and fgures. It is the set of mathematical tools
and techniques that are used to analyse data. The word statistics is said to have been derived from the German word
Statistics meaning political science or from Old Italian word stato meaning state or from New Latin word status
meaning of which is position or form of government or political state. Statistical analysis involves the process of
collecting and analysing data and then summarising the data into a numerical form.
10.2 Defnition of Statistics
The word statistics refers either to quantitative information or to a method of dealing with quantitative
information.
There are many defnitions to the term statistics given by different authors which are as given below:
Prof.A.L.Bowley defned statistics as Numerical statement of facts in any department of enquiry placed in
relation to each other.
Webster defned statistics as The classifed facts respecting the condition of the people in a state especially those
facts which can be stated in numbers or in tables of numbers or in any tabular or classifed arrangement.
10.3 Scope and Applications of Statistics
Statistics is associated with almost all the sciences as well as social, economic and political activities. The applications
of statistics are so numerous and it is of great use to human beings in many ways. Science has become so important
today that hardly any science exists independent of this and hence the statement-Science without Statistics bear
no fruit; Statistics without Science has no root.
Statistical data and statistical methods are helpful in proper understanding of the economic problems and help
in solving a variety of economic problems such as wages, prices, analysis of time series etc. Statistical methods
help in formulating economic policies and in evaluating their effect
Statistical methods are being widely used in all business and trade activities like production, fnancial analysis,
distribution, costing, market research, man power planning, business forecasting etc. Business executives and
managers rely mainly on statistical techniques to study the need and desire of the consumers.
In industry, statistics is widely used in quality control. To fnd whether the product is confrming to specifcations
or not, statistical tools like inspection plans, control charts etc are of great use
A governments administrative system is fully dependent on production statistics, income statistics, labour
statistics, economic indices of cost, price etc. All the departments of a government depend upon statistics for
effcient functioning
In biology, medicine and agriculture, statistical methods are applied in the study of growth of plant, movement
of fsh population in the ocean, migration of birds, effect of newly invented medicines, theories of heredity,
estimation of yield of crop, effect of fertiliser on yield, birth rate, death rate, population growth, growth of
bacteria etc
10.4 Characteristics of Statistics
Some of its important characteristics are given below:
Statistics are aggregates of facts
Statistics are numerically expressed
Statistics are affected to a marked extent by multiplicity of causes.
Statistics are enumerated or estimated according to a reasonable standard of accuracy.
Statistics are collected for a predetermine purpose
Statistics are collected in a systemic manner
Statistics must be comparable to each other
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10.5 Functions of Statistics
The various functions of statistics are as given below:
It simplifes the mass of data. With the help of statistical methods, the complex data is simplifed into diagrammatic
and graphical representations averages etc.
It presents the facts in a defnite form. Facts that are expressed in numbers are more convincing than expressed
in statements. Statistics helps to present the data or facts in precise and defnite form for easy understanding.
It helps in comparison of data of same kind.
Statistical methods are extremely helpful in formulating and testing hypothesis and developing new theories.
It helps to predict future trends and to estimate any value of the population from the sample chosen.
It helps in bringing out the hidden relations between variables.
With the help of statistics, decision making process becomes easier.
10.6 Limitations of Statistics
Statistics, inspite of being widely used in many felds and being involved in every sphere of human activity, faces
certain limitations which are as follows:
Statistics does not deal with qualitative aspects like honesty, intelligence etc. It deals with only quantitative
data.
It does not study individual facts because individual items taken separately do not form a statistical data.
Statistical methods can be applied only to the aggregate of facts.
Statistical tools do not provide the best solution to problems under all circumstances. It is one of the methods
of studying a problem and it should be supplemented by some other methods.
Statistical analysis is based on probability and not on certainty. So statistical results are not universally true and
they are true only on an average.
Common man cannot handle statistics properly, only statisticians can handle statistics properly.
The most important limitation of statistics is that they are liable to be misused and misinterpreted. Increasing
misuse of statistics has led to increasing distrust in statistics.
10.7 Classifcation
Classifcation refers to grouping of data into homogeneous classes and categories. A group or a class category has
to be determined on the basis of the nature of the data and the purpose for which it is going to be used.
10.8 Objectives of Classifcation
To condense the mass of data: Statistical data collected during the course of an investigation is in the raw form.
With raw data we cant make any conclusion unless it is properly classifed into small groups or classes.
To prepare the data for tabulation: Only classifed data can be presented in the tabular form.
To study the relationships: Relationship between the variables can be established only after the various
characteristics of the data have been known, which is possible only through classifcation.
To facilitate comparison: Classifcation helps us to fnd conclusions based on the comparison of variables.
10.9 Characteristics of Classifcation
The following are general guiding principles for a good classifcation.
Exhaustive: Classifcation must be exhaustive. i.e. each and every item in the data must belong to one of the
classes.
Mutually exclusive: Each item of information should ft only in one class, i.e. overlapping of items is not
allowed.
101/uts
Suitability: The classifcation should conform to the object of inquiry. For example, if the study is regarding the
economic condition of workers then classifcation must not be done on the basis of their religion.
Homogeneity: The items included in each class must be homogeneous; else there should be further classifcation
in to sub groups.
Flexibility: A good classifcation should be fexible. It should be adjustable. To the new and changed situations
and conditions.
Stability: The basic principle of classifcation should be retained throughout.
10.10 Frequency Distribution
A classifcation according to the number possessing the same value of the Variable is known as frequency distribution
of the given raw data.
Tally Marks (|): It facilitates counting the frequency of a value of a variate in a systematic manner. The distinct
values of the variate are written down in ascending or descending order in a column. As we go through the given
raw data, one by one a tally mark is inserted in each case against the respective value. It will be easy to count if
tally marks are arranged in blocks of fve i.e. every ffth tally mark is marked by a slanting line over the preceding
four. For example for the value of variate 5 we can give tally marks as ||||, for the value of variable 13 we can give
tally marks as|||| |||||||.
10.10.1 Discrete or Ungrouped Frequency Distribution
The ungrouped frequency distribution is quite handy if the values of the variables are largely repeated otherwise
there is hardly any condensation.
10.10.2 Continuous or Grouped Frequency Distribution
In this form of distribution the frequencies refer to groups of values. This becomes necessary in the case of some
variables which can take any fractional value and in whose case an exact measurement is not possible. e.g. the
height, Weight income ,etc.
10.10.3 Cumulative Frequency Distribution
In cumulative distribution, the cumulative frequencies (c.f.) are derived by successively adding the frequencies
of the successive individual class intervals. The cumulative frequency of a given class can be represented by the
total of all the previous class frequencies including the frequency of that class. There are two types of cumulative
frequencies.
less than type: It will represent the total frequency of all classes less than and equal to the class value to which
it relates.
more than type: It will represent the total frequency of classes more than and equal to the class value to which
it relates.
Quantitative Techniques
102/uts
Summary
Statistics helps in creating more effciency in the decision making process
Statistics can be said as a collection of methods for planning experiments, obtaining data, and then organising,
summarising, presenting, analysing, interpreting, and drawing conclusions
The purpose of statistics is to obtain some overall understanding of group characteristics
It is important to know how to understand statistics so that improper judgments are not made
Statistics does not deal with qualitative aspects like honesty, intelligence etc. It deals with only quantitative
data.
It does not study individual facts because individual items taken separately do not form a statistical data.
Exhaustive: Classifcation must be exhaustive. i.e. each and every item in the data must belong to one of the
classes.
Homogeneity: The items included in each class must be homogeneous; else there should be further classifcation
in to sub groups.
Flexibility: A good classifcation should be fexible. It should be adjustable. To the new and changed situations
and conditions.
Stability: The basic principle of classifcation should be retained throughout.
References
Sharma, J. K., 2009. Business Statistics, 4th ed., Dorling Kindersley Pvt. Ltd.
Jain, T. R. and Agarwal, S. C., 2009.10. Statistics for BBA, Statistics, VK Enterprises.
Medhi, J., 2005. Statistical Methods, Methods of Data Collection, 1st ed., New Age International Publishers,
pp8-12.
Rajagopalan, S. P. and Sattanathan, R., 2008. Business Statistics and Operations Research, Tata McGraw-Hill
Education, pp 1-6.
2012, Statistics, [Video Online] Available at: < http://www.youtube.com/watch?v=CWrgEjXGzfg > [Accessed
31 August 2012].
Judge, D ., Statistics, lecture 1, [Video Online] Available at: < http://www.youtube.com/watch?v=24jvU95WCtQ
> [Accessed 31 August 2012].
Leidn university Introduction Probability and Statistics [PDF] Available at: <http://www.math.leidenuniv.
nl/~redig/lecturenotesstatistics.pdf>. [Accessed 14 July 2012].
Star, Statistics http://www.stat-help.com/intro.pdf , [Accessed 14 October 2010].
Jain, T. R. and Agarwal, S. C., 2009. Statistics for BBA, Statistics, VK Enterprises.
Medhi, J., 2005. Statistical Methods, Methods of Data Collection, 1st ed., New Age International Publishers.
Rajagopalan, S. P. and Sattanathan, R., 2008. Business Statistics and Operations Research, Tata McGraw-Hill
Education.
103/uts
Self Assessment
Statistics deals with which of the following? 1.
Qualitative data a.
Qualitative and quantitative data b.
Quantitative data c.
Productive data d.
Which of the following is not a characteristic of Statistics? 2.
Statistics are aggregates of facts. a.
Statistics are affected to a marked extent by multiplicity of causes. b.
It helps in bringing out the hidden relations between variables. c.
Statistics are collected in a systemic manner. d.
Common man cannot handle statistics properly, only 3. can handle statistics properly.
technicians a.
statisticians b.
artisans c.
By statistics we mean quantitative data affected to a market extent by multiplicity of causes. This defnition 4.
is defned by:
Yule and Kendall a.
Webster b.
Prof.A.L.Bowley c.
Tippet d.
Which among the following is not a function of statistics? 5.
It presents the facts in a defnite for. a.
With the help of statistics, decision making process becomes easier. b.
It simplifes the mass of data. c.
It helps in comparison of data of different kind. d.
Statistics can be referred as a subject that deals with 6. facts and fgures.
Alphanumerical a.
Alphabetical b.
Numerical c.
Quantitative d.
The classifed facts respecting the condition of the people in a state especially those facts which can be stated 7.
in numbers or in tables of numbers or in any tabular or classifed arrangement.This defnition is given by
__________.
Tippet a.
Peter Drucker b.
Webstar c.
Oxford d.
Quantitative Techniques
104/uts
_______of data leads to false conclusions. 8.
Misinterpretation a.
Understanding b.
Conceptualisation c.
Summarising d.
Which statement is true? 9.
Statistical analysis is based on certainty and not on probability. a.
Common man can handle statistics properly. b.
Statistical tools provide the best solution to problems under all circumstances. c.
Statistics does not study individual facts because individual items taken separately do not form a statistical d.
data.
Discrete distribution is also called _______________ . 10.
Cumulative frequency distribution a.
Grouped frequency distribution b.
Ungrouped frequency distribution c.
Continuous distribution d.
105/uts
Application I
Probability
When trading stocks it is of paramount importance to remove phrases like I hope, I wish, if only from your
vocabulary. Instead it deals with stocks in probabilities. What is the probability of profting from this stock if x
equals 1 and y equals 2. By calculating probabilities two things happen. All emotion is removed from trading and a
dispassionate approach to trading can take place and we can better assess the risk to reward ratio and determine if this
is a trade that we want to undertake. In trading, emotion is the bullet that will kill you. Stick with probabilities.
It as been owned a sizable stake in a company called General Moly which will use as a proxy for my thesis. When
it has been frst learned of it has been studied the project and determined that it owned the rights to the Mt. Hope
project which is the companys fagship project. It has been learned that when it received the permit to begin building
the infrastructure for the mine that it would be sitting on the worlds largest deposit of molybdenum. It has also been
learned that it owned a site called the Liberty project that it would deal with at a later date, but from the preliminary
analysis it had done the company is sure that this project will also produce a windfall amount of molybdenum.
So whats so great about molybdenum? Molybdenum is an alloy that is a by-product of mining copper. When
molybdenum is mixed with iron ore one can create lightweight, incredibly strong stainless steel that is impervious
to high degrees of temperature and pressure. It has been concluded that this would make it an essential ingredient
for building oil rigs and nuclear reactors as well as basic infrastructure. It has also been learned that while China
exported 97% of the worlds rare earth elements (that has subsequently changed) the country actually was a net
importer of molybdenum.
My next step was to learn about the management team. It has been read everything could fnd on the management
of this company and was very pleased to learn that CEO Bruce Hansen had amassed an amazing team that was not
looking to be acquired but instead looking to take this company into the arena of being the suppliers of molybdenum
to the world.
What did the balance sheet look like? The company had received a loan from one of the largest producers of steel
in the world, a South Korean company called Posco. It had also received fnancing from a Japanese company called
Sojitz and fnally it had received a bridge loan from a Chinese company called Hanlong for the amount of \$50 million
with the promise that when permitted it would receive an additional \$665 million loan to fast track the project into
production. Make no mistake; the South Koreans, the Japanese and the Chinese were not being benevolent. They
do not want the loans paid back in dollars. They want the loans paid back in molybdenum.
So everything was going as scripted when a Black Swan appeared out of nowhere and in December of 2010 with
the stock trading at around \$7.00 an issue came up regarding water rights. To the credit of General Moly it has from
the beginning of the project dealt with every problem with complete transparency. It has followed the law chapter
and verse and there have been no mistakes made. This was no different. This did, however, slow the process down
and the stock immediately became the backyard of the short sellers who used this as an opportunity to further drive
the price down.
We will fast forward to last week when the state engineer granted the water rights to General Moly. I expected the
stock to bounce to its previous level before the water rights problem but that did not happen. What had changed
fundamentally? I got out my pencil and sharpened it. To use the latest balance sheet fgures I could fnd, I determined
that if I used a proxy price of \$15.00 a lb for molybdenum then the company should have a net present value (NPR)
of \$1.2 billion or a 66% increase over where the stock is presently trading as far as market capitalization. Given the
discount to the NPV, does this imply that the market believes that there is a 66% chance that this project will not
go into production? I conclude that this is simply not the case.
Quantitative Techniques
106/uts
Lets honestly look at the risks at this point. Lets assume the worst case scenario, China doesnt come through with
the expected fnancing or the Record of Decision (ROD) comes back negative or the Molybdenum concentrations
are signifcantly less than expected or fnally management cannot perform adequately enough to get this through
to production. China is contractually obligated to provide fnancing once permitted and moreover it needs the
molybdenum. There have been extensive exploratory bore holes done and everyone knows what is under the ground.
The management team has performed spectacularly at every turn and I see no evidence of that changing. The X factor
as I see it is the ROD and every due diligence has been taken. I see this as a probability of 80% to 90% that the ROD
will come back positively. So other than the ROD, how can this kind of discount to the NPV be justifed?
I conclude that the stock based on the fundamental analysis should be trading at the \$10 to \$12.00 range. Indeed the
previously mentioned price of molybdenum that my analysis was based on was \$15.00 a pound and as I write this,
Freeport Mac Moran, one of the largest copper producers in the world, reported that it had sold the molybdenum
(which I said was a byproduct of copper mining) at a price of \$18.00 per pound. I believe this is hedge funds
continuing to try and drive the price down and judging by what I see on the tape they are beginning to run out of
gas. Yesterday the stock closed at \$4.78 but I do not see it trading there for much longer. So I would encourage
anyone who is interested in making a proft to take a look at this project and if you like what you see stake your
claim at a very discounted price.
I have learned through bitter experience to never say never. But as I have previously stated I see the probability
of this project coming to fruition at 80% to 90%. Surely somebody in Nevada wants a billion dollar mine to operate
there. Consider the tax revenues generated for the state and the town of Eureka and the thousands of good paying
jobs this project will create.
Source: Available at :< http://sekhon.berkeley.edu/papers/QualityQuantity.pdf> [Accessed 03 September 2012].
Questions:
What did the balance sheet look like? 1.
The company had received a loan from one of the largest producers of steel in the world, a South Korean company
bridge loan from a Chinese company called Hanlong for the amount of \$50 million with the promise that when
permitted it would receive an additional \$665 million loan to fast track the project into production.
What is great about molybdenum? 2.
Molybdenum is an alloy that is a by-product of mining copper. When molybdenum is mixed with iron ore one
can create lightweight, incredibly strong stainless steel that is impervious to high degrees of temperature and
pressure.
At what range the stock should be traded? 3.
the stock based on the fundamental analysis should be trading at the \$10 to \$12.00 range.
107/uts
Application II
PERMUTATIONS
This introduces a modifed Particle Swarm. Optimizer which deals with permutation problems. Particles are defned
as permutations of a group of unique values. Velocity updates are redefned based on the similarity of two particles.
Particles change their permutations with a random rate defned by their velocities. A mutation factor is introduced
to prevent the current Best from becoming stuck at local minima. Preliminary study on the n-queens problem shows
that the modifed PSO is promising in solving constraint satisfcation problems.
A permutation problem is a constraint satisfaction problem with the same number of variables as values, in which
each variable takes a unique value. Any solution can be thought of as assigning a permutation to the variables. When
a permutation satisfes all the constraints, it is considered a feasible solution. For a permutation problem, there might
be one or multiple feasible solutions. The n-queens problem is one of the best examples of permutation problems.
Permutation optimisation problems have been found in many areas. There are many techniques developed to handle
permutation problems. In this paper, a new method called particle swarm optimization (PSO) is introduced to handle
the permutation problems.
The n-queens problem consists of placing n queens on an N by N chess board, so that they do not attack each other,
i.e. on every row, column or diagonal, there is only one queen exists. It is a classical complex constraint satisfaction
problem in the artifcial intelligence (AI) area. It has been used as a benchmark for developing new AI search
techniques. During the last three decades, the problem has served as an example and benchmark for backtracking
algorithms, permutation generation, the divide and conquer paradigm, constraint satisfaction problems, neural
networks, and genetic algorithms. Also, the n-queens problem has many practical applications such as VLSl testing,
air traffc control modem communication systems, message routing, load balancing in multiprocessor computers,
data compression, computer task scheduling, and optical parallel processing [I].
The n-queens problem bas three variants: fnding one solution, fnding a family of solutions, and fnding all solutions.
This paper deals with fnding one solution within a family.
PSO is a population based stochastic optimisation technique developed by Eberhart and Kennedy in 1995, inspired
by social behavior of bird focking or fsh schooling. During the past several years, PSO has been successfully
applied to multidimensional optimization problems artifcial neural network training multiobjective optimisation
problems. However, there is no research on permutation optimisation reported in the literature.
Similar to Genetic Algorithms (GAS), PSO is a population based optimization tool. The system is initialized with a
population of random solutions and searches for optima by updating potential solutions over generations. However,
unlike GA, PSO has no evolution operators such as crossover and mutation. In PSO, the potential solutions, called
particles, fy through the problem space by following the current better-performing particles. Each particle keeps
track of its coordinates in the problem space which are associated with the best solution (ftness) it
has achieved so far. (The ftness value is also stored.) This value is called pbest. Another best value that is tracked
by the particle swarm optimizer is the best value, obtained so far by any particle in the neighborhood of the particle.
This location is called nbest. When a particle takes all the population as its topological neighbors, the best value
is a global best and is called gbest
Source: Available at :< http://bit.csc.lsu.edu/~jianhua/chindu.pdf> [Accessed 03 September 2012].
Questions:
What does n-queen problem consists of? 1.
What is genetic algorithm? 2.
What is permutation optimization problem? 3.
Quantitative Techniques
108/uts
Application III
Matrices and Determinants
Area of a Triangle
Consider a triangle with vertices at (x
1
, y1), (x
2
, y2), and (x
3
, y3). If the triangle was a right triangle, it would be
pretty easy to compute the area of the triangle by fnding one-half the product of the base and the height.
However, when the triangle is not a right triangle, there are a couple of other ways that the area can be found.
Herons Formula
If you know the lengths of the three sides of the triangle, you can use Herons Formula to fnd the area of the
triangle.
In Herons formula, s is the semi-perimeter (one-half the perimeter of the triangle).
s = 1/2 (a + b + c)
Area = sqrt (s ( s-a) ( s-b) ( s-c) )
Consider the triangle with vertices at (-2,2), (1,5), and (6,1).
Using the distance formulas, we can fnd that the lengths of the sides (arbitrarily assigning a, b, and c) are a = 3
sqrt(2), b = sqrt(61), and c = sqrt(73).
Using those values gives us ...
s = 1/2 ( 3 sqrt(2) + sqrt(61) + sqrt(73) )
s - a = 1/2 ( - 3 sqrt(2) + sqrt(61) + sqrt(73) )
s - b = 1/2 ( 3 sqrt(2) - sqrt(61) + sqrt(73) )
s - c = 1/2 ( 3 sqrt(2) + sqrt(61) - sqrt(73) )
s ( s - a ) ( s - b ) ( s - c ) = 1089 / 4
When you take the square root of that, you get 33/2, so the area of that triangle is 16.5.
Problems with Herons Formula include
Must know the lengths of the sides of the triangle. If you dont then you have to use the distance formula to fnd
the lengths of the sides of the triangle.
You have to compute the semi-perimeter, so chances are you will have fractions to work with.
Lots of square roots are involved. For the lengths of the sides of the triangle and for the area of the triangle.
Its not the easiest thing in the world to work with.
Geometric Technique
The triangle can be enclosed in a rectangle. The vertices of the triangle will intersect the rectangle in three places,
forming three right triangles. These triangles are denoted A, B, and C in the picture.
The area of the triangle we desire will be the area of the rectangle minus the areas of the three triangles.
The legs of the three triangles can be found by simple subtraction of coordinates and then used to fnd the area
since the area of a triangle is one-half the base times the height.
Area of triangle A = 3 ( 3 ) / 2 = 9/2.
Area of triangle B = 5 ( 6 ) / 2 = 15.
Area of triangle C = 8 ( 3 ) / 2 = 12.
The sum of the areas of the triangles is 9/2 + 15 + 12 = 63 / 2 or 31.5.
109/uts
The area of a rectangle is base times height, so the bounding rectangle has area = 8 ( 6 ) = 48.
The area of the triangle in the middle is the difference between the rectangle and the sum of the areas of the three
outer triangles.
Area of triangle = 48 - 31.5 = 16.5.
Source: Available at:< http://people.richland.edu/james/lecture/m116/matrices/applications.html > [Accessed 31
August 2012].
Questions:
What is the formula to fnd area of triangle? 1.
What are the geometric Technique? 2.
What does herons formula include? 3.
Quantitative Techniques
110/uts
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Quantitative Techniques
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