Klein M. Mathematical Methods for Economics

Pearson, 2014. — 498 p.
This book begins with a three-chapter section that introduces some important concepts and tools that are used throughout the rest of the book. Chapter 1 presents background on the mathematical framework of economic analysis. In this chapter we discuss the advantages of using mathematical models in economics.We also introduce some characteristics of economic models. The discussion in this chapter makes reference to material presented in the rest of the book to put this discussion in context as well as to give you some idea of the types of topics addressed by this book. Chapter 2 discusses the central topic of functions. The chapter begins by defining some terms and presenting some key concepts.Various properties of functions first introduced in this chapter appear again in later chapters. The final section of Chapter 2 presents a menu of different types of functions that are used frequently in economic analysis. Two types of functions that are particularly important in economic analysis are exponential and logarithmic functions. As shown in Chapter 3, exponential functions are used for calculating growth and discounting. Logarithmic functions, which are related to exponential functions, have a number of properties that make them useful in economic modeling. Applications in this chapter, which include the distinction between annual and effective interest rates, calculating doubling time, and graphing time series of variables, demonstrate some of the uses of exponential and logarithmic functions in economic analysis. Later chapters make extensive use of these functions as well.