MATHEMATICAL ECONOMICS (AE-308)

DESCRIPTION AND OBJECTIVES

This course concentrates on the mathematical methods that are required to understand current economics and to investigate economic models. Topics may include advanced matrix algebra, optimization with and without constraints, and dynamic optimization. After completing the course, students will be in a position to apply the knowledge of mathematical tools for formulation of economic model(s) and analyse

INTENDED LEARNING OUTCOMES

The principal aim of this course is to extend student’s facility with those methods of mathematics needed to pursue economic analysis at a more advanced level. By the end of the course students will have extended their knowledge to include the technique of optimization under inequality constraints, the analysis of dynamic economic models, in particular differential and difference equations and dynamic optimization (optimal control theory), as well as correspondences and fixed point theorems used in general equilibrium anal

COURSE CONTENTS

The nature of mathematical economics, mathematical versus non-mathematical economics, mathematical economics versus econometrics, economic models. Review of Matrix Algebra and its application to Business and Economics. Review of Differentiation: Rules of differentiation, maxima/minima of functions, partial/total derivatives and their applications in Business and Economics. Integration: Integrals and their applications in Business and Economics. Optimization Problems.

READINGS
  1. Chiang, A. C. & Wainwright, K. (2004). Fundamental Methods of Mathematical Economics, 4th   Edition. New York: McGraw-Hill, Irwin.
  2. Silberberg, E. & Suen, W. (2001). The Structure of Economics: A Mathematical Analysis. 3rd. New York: McGraw-Hill, Irwin.
  3. Budnick, F. S. (1993). Applied Mathematics for Business, Economics and Social Sciences. New York: McGraw-Hill, Inc.
  4. Syd Saeter, K & Hammond, P. (2012). Essential Mathematics for Economic Analysis, 3rd Edition, Prentice Hall Publisher.

 

COURSE SCHEDULE

Week

Topics and Readings

Books with Page No.

1.

The nature of mathematical economics,

Chiang, A C. Fundamentals Method of Mathematical Economics. 4th Edition. Page No.2-4

 

2.

mathematical versus non-mathematical economics and econometrics

Chiang, A C. Fundamentals Method of Mathematical Economics. 4th Edition. Page No.2

 

3.

Mathematical economics versus econometrics

Chiang, A C. Fundamentals Method of Mathematical Economics. 4th Edition. Page No.4

4.

Economic models

Chiang, A C. Fundamentals Method of Mathematical Economics. 4th Edition. Page No.5-7

5.

Review of Matrix Algebra

 

Chiang, A C. Fundamentals Method of Mathematical Economics. 4th Edition. Page No.48-70

6.

Matrix Algebra and its application to Business and Economics

Chiang, A C. Fundamentals Method of Mathematical Economics. 4th Edition. Page No.107-111

 

7.

partial/total derivatives

Chiang, A C. Fundamentals Method of Mathematical Economics. 4th Edition. Page No.179-189

8.

partial/total derivatives and their applications in Business and Economics

Chiang, A C. Fundamentals Method of Mathematical Economics. 4th Edition. Page No.209-213

9.

 

maxima/minima of functions and their applications in Business and Economics

Chiang, A C. Fundamentals Method of Mathematical Economics. 4th Edition. Page No.313-320

10.

maxima/minima of functions and their applications in Business and Economics

Chiang, A C. Fundamentals Method of Mathematical Economics. 4th Edition. Page No.313-320

11.

Rules of differentiation

Chiang, A C. Fundamentals Method of Mathematical Economics. 4th Edition. Page No.124-128

12.

Review of Differentiation

Chiang, A C. Fundamentals Method of Mathematical Economics. 4th Edition. Page No.161-165

13.

Integration definite and indefinite

Chiang, A C. Fundamentals Method of Mathematical Economics. 4th Edition. Page No.444-454

 

14.

Integrals and their applications in Business and Economics

Chiang, A C. Fundamentals Method of Mathematical Economics. 4th Edition. Page No.464-470

 

15.

Dynamic Analysis, First and Higher Order Differential Equation and Exact differential Equation

Chiang, A C. Fundamentals Method of Mathematical Economics. 4th Edition. Page No.474-527

 

16.

First and Higher Order Difference Equation

Chiang, A C. Fundamentals Method of Mathematical Economics. 4th Edition. Page No.544-556

 

Final Term Exam

 

 

ASSESSMENT CRITERIA

 

Sessional:                 12 (Class Attendance:2, Presentation:4, Assignments: 6)

Mid Term Test:          18

Final Term Test:        30

Course Material

Other Courses by Mr. Zulqarnain Haider