APPLICATION OF MATHEMATICS

(INTEGRAL & DIFFERENTIAL CALCULAS , SET AND MATRIX)

IN
REAL WORLD BUSINESS

Group 6
Department of Finance,
Jagannath University,
Dhaka
6/13/2014
Application of Mathematics in Real World Business

Business Mathematics-02
Report
On
Square Pharmaceuticals Ltd.
Submitted to

Kawser Ahmed Shiblu

Lecturer
Department of Finance
Jagannath University.
Submitted by
Group-6
SL NO. NAME ID NO.
01 MD. MONOAR HOSSAIN B-120203005
02 SABIHA JHUMUR B-120203010
03 MD. SAIDUL ISLAM B-120203060
04 SUNJIDA PARVEN B-120203069
05 MD. SHAKHAWAT HOSSAIN B-120203080
06 MD. RAJU AHAMED B-120203091
07 EMDAD MUNSHI B-120203092
08 AYASHA SIDDIQUA MOUE B-120203099
09 MALEKA AKTER B-120203106
10 MILON SAHA B-120203108

Date of Submission: 13 July, 2014

Department of Finance Jagannath University 2|Page

 Declaration

We hereby declare that, this report contains no bits and pieces which
has been accepted for the award of any other degree or diploma at any
university or equivalent institutions and that to the best of our
appreciative and faith, this report contains no objects previously
existing or written by another person, except where due reference is
made in the content of the report.

Group- 6
 Letter of Transmittal

13 July, 2014

Kawser Ahmed Shiblu

Lecturer
Department of Finance
Jagannath University.

Sub: Submission of the Report.

Dear Sir,

With due respect, we would like to inform you that, we are the student
of Department of Finance. It is our great pleasure to inform you that we
have got a chance to submit a report on “APPLICATION OF
MATHEMATICS IN REAL WORLD BUSINESS - A Study on “Square
Pharmaceuticals Ltd.” as a requirement for course named Business
Mathematics-02, course no: 2103.

We therefore pray and hope that you would be kind enough to accept
this report and bless us heartily.

Sincerely yours

Group-6
B.B.A. 7th Batch
2nd Year 1st semesters
Department of Finance
Jagannath University, Dhaka.
 Acknowledgement

All praises are due to Almighty Allah, the supreme authority of this
universe who has enabled us to submit the report in time for the course
named Business Mathematics-02.

We express our cordial sense of appreciation, thanks, authentic

gratitude and profound regards to our honorable supervisor Kawser
Ahmed Shiblu, Lecturer, Department of Finance, Jagannath University,
Dhaka for his scholastic direction, pleasant support, constant
encouragement, precious guidance, overall management and
continuous importance throughout the thesis work.

It’s a great pleasure to us to express deep gratitude and cordial

admiration to our dearly loved parents, well wishers and friends for
their ever ending wish, affections, support, sacrifice, inspiration,
encouragement and nonstop endorse in the long process of creating our
academic career which can never be repaid.

Group-6
 Executive Summary
Business Mathematics “includes mathematics courses taken at an
undergraduate level by business students. These courses are slightly
less difficult and do not always going to the same depth as other
mathematics courses for people majoring in mathematics or science
fields. The two most common math courses taken in this form are
Business Calculus and Business Statistics. Examples used for problems
in these courses are usually real-life problems from the business world.
An example of the differences in course work from a business
mathematics course and a regular mathematics course would be
calculus. In a regular calculus course, students would study
trigonometric functions. Business calculus would not study
trigonometric functions because it would be time-consuming and
useless to most business students, except perhaps economics majors.
Economics majors who plan to continue economics in graduate school
are strongly encouraged to take regular calculus instead of business
calculus, as well as linear algebra and other advanced math courses.
Other subjects typically covered in a business mathematics curriculum
include:

 Matrix algebra
 Linear programming
 Probability theory
 Set

In Our study we show how integral and differential Business calculus is

used in Business as a part of our topic “Application of Mathematics
in real world Business. A study on- “Square Pharmaceuticals Ltd.”.
 Table of Content
Name Page No.
Acknowledgement 5
Executive Summary 6
1.1 Introduction 8
1.2 Objective of the report 8
Part - I 1.3 Scope of the study 9
1.4 Methodology of the study 9
1.5 Limitation of the study 10
2.1 Business Mathematics 11
2.2 Calculus 11
2.3 Differential Calculus 12
Part - II 2.4 Integral Calculus 12
2.5 Theory of Sets 13
2.6 Matrix 13
3.1 Company Profile 15
3.2 Literature View 16
3.3 Application of Differential Calculus 17
Part -III 3.4 Application of Integral Calculus 18
3.5 Application of Set 21
3.6 Application of Matrix 23
Conclusion 30
Part -IV
Bibliography 30
 Part-I
1.1 Introduction

Business ownership requires more than skill in creating a product or

talent at providing a service. Overseeing the finances of your company
is key to survival and success. Understanding basic business math is
necessary for profitable operations and accurate record keeping.
Knowing how to add, subtract, multiply, divide, round and use
percentages and fractions is the minimum you need to price your
product and meet your budget. If math is not your strength, partner
with someone who can take over that role or hire a trusted employee
to help your operation stay in the black and grow responsibly.

Since the research topic is “Application of Mathematics in real

world Business - A Study on “Square Pharmaceuticals Ltd.” and also
find out how math rules are applied in the business to determine
average cost, marginal const, Net profit etc.

1.2 Objective of the report

The main objective of this study is to gain knowledge about Application

of Mathematics in Real World Business.

Primary Objectives:

The main objective of this report is to analyze Financial Statement of

“Square Pharmaceuticals Ltd.” to find out how they Apply Integral and
Differential calculus function in their Financial Statement.
Secondary Objectives:

This assignment has also some other objectives which are as follows:

 To know about the application of Business Math

 To know how to determine net profit, per unit average
cost etc by using Calculus mathematics.

1.3 Scope of the Study

There were huge scopes to work in the arena of the case. Considering
the dead line, the scope and exposure of the paper has been wide-
ranging. The study behind “Application of Mathematics in Real World
Business - A Study on “Square Pharmaceuticals Ltd.” has covered
overall analysis by which we can know about the Application of
mathematics which they use.

1.4 Methodology of the study

 Mathematics With Applications In Management &

Economics (7th edition) by Prichett & Saber
 Business Mathematics (11th edition) by D.C. Sancheti &
V.K. Kapoor.

Sources of data
Here the secondary sources of information were used. The secondary
sources are:
 Web sites
 Books
 Annual report

1.5 Limitation of the study

As we collected our information through secondary sources, so we have

not been able to collect more information which could give us more
clear knowledge about the Application of Math. While conducting the
case on “Application of Mathematics in real world Business - A Study
on “Square Pharmaceuticals Ltd.” some limitations were yet present
there:

 Lack of time shortage many related part cannot be

paying attention in depth.
 Current data and information on
different activities was
unavailable.
 As a report analysis, it has been prepared shortly
 Part II
2.1 Business Mathematics

Business mathematics is mathematics used by business enterprises to

record and manage business operations. Business organizations use
mathematics in accounting, inventory management, marketing, sales
forecasting, and financial analysis.

Mathematics typically used in commerce includes elementary

arithmetic, elementary algebra, statistics and probability. Business
management can be made more effective in some cases by use of more
advanced mathematics such as calculus, matrix algebra and linear
programming; see operations research.

2.2 Calculus

Calculus is the mathematical study of change,[1] in the same way that

geometry is the study of shape and algebra is the study of operations
and their application to solving equations.

Calculus is a part of modern mathematics education. A course in

calculus is a gateway to other, more advanced courses in mathematics
devoted to the study of functions and limits, broadly called
mathematical analysis.

It has two major branches. They are

 Differential Calculus (concerning rates of change and slopes of
curves), and
  Integral Calculus (concerning accumulation of quantities and the
areas under and between curves);

2.3 Differential Calculus

Differential calculus is the study of the definition, properties, and

applications of the derivative of a function. The process of finding the
derivative is called differentiation. Given a function and a point in the
domain, the derivative at that point is a way of encoding the small-scale
behavior of the function near that point. By finding the derivative of a
function at every point in its domain, it is possible to produce a new
function, called the derivative function or just the derivative of the
original function.

2.4 Integral Calculus

Integral calculus is the study of the definitions, properties, and

applications of two related concepts, the indefinite integral and the
definite integral. The process of finding the value of an integral is called
integration. In technical language, integral calculus studies two related
linear operators.

The indefinite integral is the anti derivative, the inverse operation to

the derivative. F is an indefinite integral of f when f is a derivative of F.
(This use of lower- and upper-case letters for a function and its
indefinite integral is common in calculus.)

The definite integral inputs a function and outputs a number, which

gives the algebraic sum of areas between the graph of the input and
the x-axis. The technical definition of the definite integral is the limit of
a sum of areas of rectangles, called a Riemann sum.

The symbol of integration is , an elongated S (the S stands for "sum").

The definite integral is written as:

2.5 Theory of Sets

Set theory is a mathematical abstract concerned with the grouping of
sets of numbers that have commonality. For example, all even numbers
make up a set, and all odd numbers comprise a set. All numbers that
end in zero make up a set of numbers that can be divided by 10. Using
and comparing sets enables the creation of theories and rules that have
practically unlimited scope, whether in mathematics or applied to areas
such as business.

2.6 Matrix
A matrix organizes a group of numbers, or variables, with specific rules
of arithmetic. It is represented as a rectangular group of rows and
columns, such as

.
This “2X3″ matrix has two rows and three columns; the number
’23′ is in the second row of the third column.

An example of a square matrix with variables, rather than numbers, is .

This is a square matrix because the number of rows equals the number
of columns.

We can only add matrices of the same dimensions, because we add the
corresponding elements. .

Matrix multiplication is another matter entirely. Let’s multiply

matrices MP=R. M is an m X n matrix; P is n X p; and the result R will
have dimension m X p. Note that the number of columns of the left-
hand matrix, M, must equal the number of rows of the right hand
matrix, P. For example. A matrix can also multiply, or be multiplied by, a
vector.

Matrix mathematics has many applications. Mathematicians, scientists

and engineers represent groups of equations as matrices; then they
have a systematic way of doing the math. Computers have embedded
matrix arithmetic in graphic processing algorithms, especially to render
reflection and refraction. Some properties of matrix mathematics are
important in math theory.

However, few of us are likely to consciously apply matrix mathematics

in our day to day lives.
 Part-III

3.1 Company profile

Square Pharmaceuticals Ltd. was established as a partnership firm in

1958. In 1991 it was converted into a public limited company.

Square Pharmaceuticals Limited is the largest pharmaceutical company

in Bangladesh and it has been continuously in the 1 st position among all
national and multinational companies since 1985. Since 1987 Square
has taken aggressive measures to explore new countries as potential
export market. It pioneered exports of medicines from Bangladesh in
1987 and has been exporting antibiotics and other pharmaceutical
products. More & more countries are getting confidence in
Square’s product every year. But it’s true that in the competitive
global environment Square is still struggling to ensure firm footings in
global market. Square is the flagship Pharma Company in Bangladesh,
wants to be a global player.

SQUARE Pharmaceuticals Limited has extended its range of services

towards the highway of global market. This extension in business and
services has manifested the credibility of Square Pharmaceuticals
Limited.

Contact to Square Pharmaceuticals Limited

Corporate Office Location:

Square Center, 48, Mohakhali C/A, Dhaka- 1212

Phone: +88 (02) 985 9007, 8833047-56
Fax: +88 (02) 8834941, 8828768

Factory/ Plant Location:

Shalgaria, Pabna Town

Pabna, Bangladesh.

3.2 Literature View

Mission:

Square Pharmaceutical’s Mission is to produce and provide quality &

innovative healthcare relief for people, maintain stringently ethical
standard in business operation also ensuring benefit to the shareholders,
stakeholders and the society at large.

Vision:

We view business as a means to the material and social wellbeing of

the investors, employees and the society at large, leading to accretion
of wealth through financial and moral gains as a part of the process of
the human civilization.

Objective of the Company

Our objectives are to conduct transparent business operation based on

market mechanism within the legal & social framework with aims to
attain the mission reflected by our vision.
3.3 Application of Differential Calculus

We are given x unit of tablet are produced, the average cost per unit is
A(x) Taka (we assume). Where

Now we find out the value of y that maximizes average cost per unit.

We start by A(x) as

-1 +0.05x

Differentiating A(x) we obtain

A’(x) = 200(-1)---------------2 (0.1) + 0.05

= -20 -2 + 0.05

A’(x) = + 0.05

Continuing, we get A’(x) equal to 0 and solve for x

+0.05=0

So X = 150 and X= -250

We discard X=-250 because it is negative and the problem statement

requires that X be greater than 0

Now we find out Minimum Average Cost

To find the minimum average cost per unit of tablet, we write

A’(x) = +0.05x
Then

A (150) = +0.05*150

= 17.50 per unit

3.4 Application of Integral Calculus

Using Integral Calculus, We can determine

 Net profit
 Consumer Surplus
 Producer Surplus

Illustration 1
Square Pharma has a Fixed Cost of 820 TK. Corer.
Here (in corer)

Total revenue= (4 − 𝑡
Total cost= 4 4 𝑡
And, Fixed cost=820

So, (4 − 𝑡 ) 4 4 𝑡
Or, 6 𝑡 36
Or , 𝑡 6
Or, 𝑡 36

Here , t=36 month

. Now,

Net Profit= ∫ 44𝑡𝑡−

(4 − 𝑡 ) 𝑡 − ∫

=(4 𝑡 − ) − 4 𝑡 − −

=(4 36 − − 4 36 − −

=14400-2880-1440-5760-820

=Tk.3500 corer

So, the net profit is Tk.3500 corer.

Illustration 2
At Market Equilibrium, Consumer demand of Square Pharma 400,000
unit of Tablet. This has a demand function (we assume)

− 6

From Above Information we can Compute Consumers Surplus as follow:

First, we must determining the equilibrium point , we are given
4 thousand, so we compute the as

− 6

Or ,4 − 6 4

=25-0.6(20)

=Tk.13 per unit of Tablet

*1 unit= 10 Tablet.

Consumer Surplus, = Quantity Demand- total revenue

= ∫ ( − 6) − 3 4

= 4 − 4 (4 ) − −

= 10000-3200-5200

= Tk.1600 thousand.
Illustration 3
At Market Equilibrium, Consumer demand of Square Pharma 400,000
unit of Tablet. This has a Supply function (we assume)

First we begin by determining the equilibrium point (.............Since once

more we are given

= 400 thousand

. we are now computing as

= (400) =7+0.3(400)1/2

= Tk.13 per unit of Tablet.

Then,

Producer’s surplus = Total revenue- quantity supply

= (13)(400)-∫ ( 3 )dq

= 5200-[(7)(400)+0.2(400)3/2 –(0+0)]

= Tk.800 thousand
3.5 Application of Set
A Survey on Consumer Preference (1200 Sample)
A question was Asked them that which company’s medicine do
you prefer And provide them 3 alternatives: Square, Beximco and
Incepta.
Among Them 512 chose Square, 400 chose Beximco and 350 chose
Incepta. 95 chose both Square & Beximco, 142 chose both Square &
Incepta, 100 chose Beximco & Incepta and 50 chose all of them. Now
from Above data we can determine:
1. How Many consumer did not Choose any one?
2. How Many consumers choose only one?
Solution
(1) We are given:
n(U) =1200 n(S) =512 n(B) =400 n(I) =350
n(SПB) =95 n(SПI)=142 n(BПI) =100 and
n(SПBПI) =50
Now’
n(S U B U I) = n(S) + n(B) + n(I) - n(SПB)-n(SПI) - n(BПI) + n(SПBПI)
=512+400+350-95-142-100+50 =975
So no. of consumer did not choose any,
= n(u)- n(S U B U I) = 1200-975 = 225person
(2) No. of consumer who choose Only Square
= n(S) - n(SПB) - n(SПI) + n(SПBПI) = 512-95-142+50= 325person
No. of consumer who choose Only Beximco
= n(B) - n(SПB) - n(BПI) + n(SПBПI) = 400-95-100+50= 255 person
 No. of consumer who choose Only Incepta
= n(I)-n(BПI)-n(SПI) +n(SПBПI) =350-100-142+50= 158person
So, Square is the highest preference among consumers
3.6 Application of Matrix
A matrix is a two-dimensional arrangement of numbers in rows and
columns enclosed by a pair of square brackets [ ]in the form shown
below

Example:
a11 a12 a13

a21 a22 a23

a31 a32 a33

The above figure shows an m × n matrix of m rows and n columns.

In this project, the following applications to matrices will be discussed:

 Applications of Matrix Addition and Subtraction

 Applications of Multiplication of Matrices
 Application of inverse Matrices

But first, let’s discuss how various situations in business and

economics can be represented using matrices. This can be done using
the following

Examples:
  Annual productions of Square Pharmaceuticals Limited of
three products may be represented as follows:

Tablet capsule syrup

A 600000 400000 300000

B 500000 350000 250000

 2. Number of staff in the office can be represented as follows:

1 Officer

2 Staff

3 Worker

Applications of Matrix Addition, Subtraction and Multiplication

The applications of addition, subtraction and multiplication of matrices

can be illustrated through the following example

Illustration 1 - The quarterly production of Tablet, Capsule, and Syrup

for the year 2012 and 2013 are given below.
Q1 Q2 Q3 Q4

Tablet 5000 3000 5000 7000

A= Capsule 2000 3000 3000 4000

Syrup 1000 3000 1000 3000

Q1 Q2 Q3 Q4

Tablet 3000 4000 5000 6000

B= Capsule 1000 3000 2000 4000

Syrup 1000 2000 1000 3000

Solution: the total sales of Tablet, Capsule, and Syrup will be obtained
as under:

5000 3000 5000 7000 3000 4000 5000 6000

A+B= 2000 3000 3000 4000 1000 3000 2000 4000

1000 3000 1000 3000 1000 2000 1000 3000

8000 7000 10000 13000

= 3000 6000 5000 8000

2000 5000 2000 6000

Illustration2-

A represents the production of whole 2013 year is

20000

A= 12000

8000

B represents the production for the first three months

5000

B= 2000

1000

Find the production for the last nine months.

Solution: 20000 5000 15000

A - B = 12000 - 2000 = 10000

8000 1000 7000

Illustration3- Q represents the total quantity of production and P
represents the price.
20000 8

Q= 12000 P= 6

8000 6

Solution:

So the cost of production is

20000 8 160000

Q*C= 12000 * 6 = 72000

8000 6 48000

Illustration4-

By using of inverse matrix we can determine the salary of our officers,

staffs and workers.

Let,

X represents the salary of workers

Y represents the salary of staffs

Z represents the salary of officers

Than the equation for 2011, 2012 and 2013 are:

10X+5Y+3Z =282000 (2013)

8X+4Y+3Z =240000 (2012)
7X+4Y+2Z =204000 (2011)
Solution:
10 5 3 X 282000

8 43 * Y = 240000

7 42 Z 204000

Step1: finding the determinants: A

4 3 8 3 8 4

|A| =10 -5 +3

4 2 7 2 7 4

= 10(8-12)-5(16-21)+3(32-28)
= 10(-4)-5(-5)+3(4)
= -40+25+12
= -3

Step2: finding the minor matrix:

43
83 84

42 72 74

53 10 3 10 5

42 72 74

53 10 3 10 5

43 83 84

-4 -5 4
5
= -2 -1 0
3 6
Step3: finding the co-factor:
Cij = (-1)i+J *Mij
C11 = (-1)1+1 *-4 = 1*-4 = -4
C12 = (-1)1+2 *-5 = 5
C13 = (-1)1+3 *4 = 4
C21 = (-1)2+1 *-2 = 2
C22 = (-1)2+2 *-1 = -1
C23 = (-1)2+3 *5 = -5
C31 = (-1)3+1 *3 = 3
C32 = (-1)3+2 *6 = -6
C33 = (-1)3+3 *0 = 0

C11 C12 C13 -4 5 4

C21 C22 C23 = 2 -1 -5

C31 C32 C33 3 -6 0

-4 2 3

Ad joint A= 5 -1 -6

4 -5 0

A-1= 1 |A| * Ad joint A

-4 2 3

= 1÷ (-3) 5 -1 -6
4 -5 0
 -4/-3 2/-3 3/-3

= 5/-3 -1/-3 -6/-3

4/-3 -5/-3 0/-3

For getting of x, y and z we do:
4/-3 2/-3 3/-3 282000

= 5/-3 -1/-3 -6/-3 *240000

4/-3 -5/-3 0/-3 204000

282000 * -4/-3 240000 * 2/-3 204000 * 3/-3

= 282000 * 5/-3 240000 * -1/-3 204000 * -6/-3

282000 * 4/-3 240000 * -5/-3 204000 * 0/-3

376000 -160000 -204000

= -470000 80000 408000

-376000 400000 0

12000

= 18000

24000

= Y

Z So, X= 12000 is the salary of worker

Y= 18000 is the salary of staffs

Z= 24000 is the salary of officers

Application of Mathematics in Real World Business

Part IV
Conclusion: From the analysis we can say that
Mathematics can be applied in business
operation and it helps us a lot to do
business accurately and easily.

Bibliography

BOOKS
 Mathematics With
Applications In Management &
Economics (7th edition) by Prichett
& Saber
 Business Mathematics (11th
edition) by D.C. Sancheti & V.K.
Kapoor.

Website
 http://smallbusiness.chron.com/importance-
basic-math-business- 41097.html

http://www.scribd.com/doc/122431
59/Role-of-Mathematics-in-
Business

http://en.wikipedia.org/wiki/Business_
mathematics
Application of Mathematics in Real World Business

Department of Finance