2015 Fall ECON 386 LECTURE A1

ECONOMICS 386 APPLICATIONS OF MATHEMATICS TO ECONOMICS I
Semester: Fall 2015

Section A1: Tuesday and Thursday 12:30 – 1:50 PM
Location: V 103
Instructor: Professor Xuejuan Su
Office hours: Wednesday 1:30-3:00 pm at 9-22 Tory Building or by appointment
Email address: [email protected]
Office phone: (780) 492-4198
Required Textbook: Essential Mathematics for Economic Analysis (4th Edition). Authors:
Knut Sydsaeter, Peter Hammond, and Arne Strom. ISBN: 9780273760689. Price around $90
(the exact amount depends on the vendor). Used books are ok.
Course Overview
The purpose of this course is to provide you with a toolbox of mathematical techniques and
concepts that are used in modern economic and econometric analysis. By the end of the course,
you should be able to:
1. Solve quadratic equations and systems of linear equations with multiple unknowns;
2. Work with basic functions such as logarithmic, exponential and power functions and be
familiar with their properties;
3. Calculate derivatives and integrals involving functions that are commonly used in
economic analysis;
4. Set up and solve basic unconstrained optimization problems;
5. Set up and solve basic constrained optimization problems;
6. Understand the basics of linear algebra, including matrix operations, geometric
interpretation of vectors, as well as singularity, determinant, and the inverse of a matrix.
Prerequisites
ECON 281, 282, 299; and Math 125 or equivalent. This prerequisite will be enforced.
Course Materials
Announcements, handouts, practice problems, and previous sample exams (as representative
evaluative course materials) will be posted on Moodle. Please check the announcement section
of Moodle frequently. If you have any troubles accessing the Moodle course website, please
send an e-mail to the Moodle support staff. They are the only ones that can help you.
Attendance and Class Participation

There is no mandatory attendance requirement in this course, as rational individuals can be
expected to make the best decisions regarding their time allocation choices. ☺ However, not
coming to class regularly may hinder your ability to do well in this course. This is a hands-on
course. To best learn these mathematical tools, you need to keep up with the daily progress of
topics and hone your own skills. Since exams will focus on materials discussed in class,
attending class regularly will help save your learning effort, better your understanding, and
improve your final grade.
1
Recording of Lectures:
Audio or video recording of lectures, labs, seminars or any other teaching environment by
students is allowed only with the prior written consent of the instructor or as a part of an
approved accommodation plan. Recorded material is to be used solely for personal study, and
is not to be used or distributed for any other purpose without prior written consent from the
instructor.
Grades
Your grade in Econ 386 will be determined by your exam performance. There are two mid-
term exams, to be held in class, and a final exam. All exams are cumulative, but more weight
is given to the new materials not covered in the previous exam. The use of notes or books is
NOT allowed during the exams, and no calculators or other electronic devices can be used. The
breakdown of the scores is shown below, together with TENTATIVE exam dates.1
Mid-term Exam I 30 % Date: September 29 (in class)

Mid-term Exam II 30 % Date: November 3 (in class)
Final Exam 40 % Date: December 15, 2-4 pm
Grades reflect judgments of student achievement made by your instructor. These judgments are
based on a combination of absolute achievement and relative performance in a class. There are
no extra credits or bonus points for this course. The overall grade distribution follows the
university guidelines.
Letter Point
Descriptor Grade Value
A+ 4.0
Excellent A 4.0
A- 3.7
B+ 3.3
Good B 3.0
B- 2.7
C+ 2.3
Satisfactory C 2.0
C- 1.7
Poor D+ 1.3
Minimal Pass D 1.0
Failure F 0
Absence from Exams

Following the U of A regulation for excused absences, if a student misses one of the two mid-
term exams because of incapacitating illness, severe domestic affliction or other compelling
reason (including religious conviction), then the final will count for 70% of the course grade. If
a student misses two mid-term exams, then the student is required to write an equivalent exam
at a time set by the instructor and the final will count for 70% of the course grade. If the student
does not write the assigned make-up exam at the prescribed time, a raw score of zero will be
assigned for all missed exams (refer to Calendar, §23.5.6, Point 1).
1
Other deadlines: September 15, 2015, Registration (Add/Delete); October 2, 2015, Fee Refund 50%; and finally,
November 30, 2015, Withdrawal (Grade W).
2
A student who has missed a final exam because of incapacitating illness, severe domestic
affliction or other compelling reason (including religious conviction) may apply for a deferred
exam. A deferred final exam will not be approved if a student, excluding the final exam, has
completed less than half of the assigned work (Calendar, §23.5.6, Point 2). Hence if you have
written only one term exam you cannot apply for a deferral.
Students with special needs (University Calendar §25.2):
Students with disabilities or special needs that might interfere with their performance should
contact the professor at the beginning of the course with the appropriate documentation. Every
effort will be made to accommodate such students, but in all cases prior arrangements must be
made to ensure that any special needs can be met in a timely fashion and in such a way that the
rest of the class is not put at an unfair disadvantage.
Exam arrangements: SAS (Student Accessibility Services) and the student, with the approval
of the course instructor, determine exam accommodations. Assessments and/or documentation
of the need for accommodation are required. At the beginning of each term, the student meets
with instructors to review the exam arrangements which will be used. They provide a “Letter
of Introduction” from SAS verifying the nature of the accommodations required due to the
disability. A few weeks before each exam, the student completes an “Exam Schedule” form,
for SAS, outlining scheduled exam dates, times, etc. At least one week before the exam the
student then takes an “Exam Instructions and Authorization” form to the instructor. The
instructor is asked to complete the form and enclose it with the exam and arrange to have it
delivered or mailed to SAS. In administering exams, SAS follows university protocol and only
makes accommodations as required due to the disability. Exams are usually set to overlap with
the time the professor has set the in-class exams.
Learning and working environment

The Faculty of Arts is committed to ensuring that all students, faculty and staff are able to work
and study in an environment that is safe and free from discrimination and harassment. It does
not tolerate behaviour that undermines that environment. The department urges anyone who
feels that this policy is being violated to:
• Discuss the matter with the person whose behaviour is causing concern; or
• If that discussion is unsatisfactory, or there is concern that direct discussion is
inappropriate or threatening, discuss it with the Chair of the Department.
For additional advice or assistance regarding this policy you may contact the student
ombudservice: (http://www.ombudservice.ualberta.ca/). Information about the University of
Alberta Discrimination and Harassment Policy and Procedures can be found in the GFC Policy
Manual, section 44 available at http://gfcpolicymanual.ualberta.ca/.
3
Please read the following notes
“Policy about course outlines can be found in Section 23.4(2) of the University Calendar.”
“The University of Alberta is committed to the highest standards of academic integrity and
honesty. Students are expected to be familiar with these standards regarding academic honesty
and to uphold the policies of the University in this respect. Students are particularly urged to
familiarize themselves with the provisions of the Code of Student Behaviour (online at
http://www.governance.ualberta.ca/en/CodesofConductandResidenceCommunityStandar
ds/CodeofStudentBehaviour.aspx) and avoid any behaviour which could potentially result in
the suspicions of cheating, plagiarism, misrepresentation of facts and/or participation in an
offence. Academic dishonesty is a serious offence and can result in suspension or expulsion
from the University.”
Course Topics
• Quadratic equations, absolute values, summations. Chs. 1,2&3.

• Basic functions. Chs. 4&5.
• Derivatives (basics). Taylor series expansion, in one variable. Elasticities.
Unconstrained optimization with single choice variable. Concavity/convexity for sets
and functions of one variable. Basics of limits for univariate functions (includes the
l’Hopital’s rule). Chs. 6,7,8.
• Integration (by substitution, by parts) for functions in one variable. Ch. 9.
• Continuous compounding of interest/ present values. Ch. 10.
• Total derivatives, partial derivatives, gradients, total differentials, quadratic forms,
Hessian (rule for calculating the determinant of a 2x2 and 3x3), concavity/convexity,
Taylor series expansion in two variables, homogeneous functions, homothetic
functions, Euler’s rule. Marginal Rate of Substitution. In particular: the implicit
function theorem for single equation and for systems. Chs. 11&12.
• Unconstrained optimization with multiple choice variables. Envelope Theorem. Ch. 13.
• Constrained optimization with multiple choice variables. Envelope Theorem. Shadow
prices. Ch. 14. The examples on optimization will include comparative statics of
optimal choices.
• Matrix algebra, calculating a determinant, singularity, non-singularity (using
determinant only), matrix inversion, use matrices to solve linear systems of equations,
Cramer’s rule, Leontief’s model. Chs 15-16.

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ECONOMICS 386 APPLICATIONS OF MATHEMATICS TO ECONOMICS I

Semester: Fall 2015

Attendance and Class Participation

Mid-term Exam I 30 % Date: September 29 (in class)

Absence from Exams

Learning and working environment

• Quadratic equations, absolute values, summations. Chs. 1,2&3.

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