HCMUT – DEPARTMEND OF MATH.

APPLIED
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CALCULUS FOR BUSINESS 212

FUNCTION OF SEVERAL VARIABLES

• PhD. NGUYỄN QUỐC LÂN (April, 2022)

 CONTENTS
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1- DEFINITION. GRAPH
2- PARTIAL DERIVATIVES

3- EXTREMA
4- CONSTRAINED MAX – MIN.
 FUNCTIONS OF TWO VARIABLES
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A function f of two variables is a formula z = f ( x, y ), ( x, y )  D.

The set D = ( x, y ) | f ( x, y ) is defined  R 2 is the domain of f

Example : For f ( x, y ) = y 2 − x , find f (1,2 ), f (2,1) & domain D.

 ECONOMIC EXAMPLE
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A store sells two kinds of jersey, the Messi & Ronaldo autograph
brands. Consumer demand for each brand depends not only on
its own price but also on the price of other brand: If Messi brand
– x USD/jersey & Ronaldo – y USD/jersey then Messi demand is
D1 = 300 – 20x + 30y & Ronaldo is D2 = 200 + 40x – 10y per
month. Express the monthly store’s revenue through x, y.
 PARTIAL DERIVATIVES OF z = f(x, y)
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 / f  Partial
 f x = f x = x  Derivatives
z = f ( x, y )   
f
 f y/ = f y =  with respect
 y  to x (or y )
Rule for finding partial derivatives of z = f(x, y)

1/ To find fx, regard y as a constant and differentiate z = f(x, y) with

respect to x

2/ To find fy, regard x as a constant and differentiate z = f(x, y) with

respect to y

 f x (2,1) = ?
z = x + x y − 2y  
3 2 3 2

 f y (2,1) = ?
 COBB – DOUGLAS FUNCTION
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In 1928, Cobb and Douglas studied the growth

of the American economy during the period
1899 – 1922. The function they used to model
the production was of the form P = bLK1−:
expression of two variables K & L, K = capital,
L = Labor force. For the next tabble Cobb and
Douglas found the production function P =
1.01L0.75K0.25. Let use this function for the years
1910 and 1920:
 INCREMENTAL APPROXIMATION
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f f
z = f ( x, y )  z ( x + x, y + y ) − z ( x, y ) = z  x + y
x y

1 1
Example 7.2.10: At some factory, the daily output: Q = 60K 2 L3
units, where K – capital investment measured in units of $1000
and L – size of the labor force measured in worked – hours. The
current capital is $900.000 and 1000 worker – hours of labor are
used each day. Estimate the change in Q if capital is increased by
$1000 labor is increased by 2 worker – hour
 ECONOMIC EXAMPLE
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1 1
Example 7.2.10: At some factory, the daily output: Q = 60K 2 L3
units, where K – capital investment measured in units of $1000
and L – size of the labor force measured in worked – hours. The
current capital is $900.000 and 1000 worker – hours of labor are
used each day. Estimate the change in Q if capital is increased by
$1000 labor is increased by 2 worker – hour
 HIGHER – ORDER PARTIAL DERIVATIVE
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zx  ( z x )x = z xx , ( z x ) y = z xy
z = f ( x, y )   Functions of x, y  
(z y )x = z yx , (z y )y = z yy
:
z y 
2 f 2 f 3 f
2 nd partial derivative. Note : f xx = 2 , f xy = , f xyy = 
x xy xy 2

Example : Find the second partial derivatives of f = x 3 + x 2 y 3 − 2 y 2

2 f 2 f
 f = f ( x, y ) : =
xy yx

3 f    2 f     2 f   3 f
Consequence : f xyx = =   =   = 2 = f x2 y
xyx x  yx  x  xy  x y
 LOCAL (RELATIVE) MAX & MIN: EXTREMA
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z = f(x, y) has a local maximum at (a, b) if f(x, y)  f(a, b) when (x,

y) near (a, b), that means f(x, y)  f(a, b)  (x, y)  some disk
center (a, b). f(x, y)  f(a, b), (x, y) near (a, b): local minimum

Local (Relative) maximum,

minimum → Extremum
(extrema). Distinguish with
absolute maximum (or
minimum): f(x, y)  (or )
f(a, b)  (x, y)  D → Global
maximum, minimum
 STUDY EXTREMUM OF z = f(x, y)
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 f x ( x, y ) = 0 x = a
1/ (Necessary): Solve   ... → P1 (a; b ), P2 ...
 f y ( x, y ) = 0 y = b
2/ (Enough conditions)
Evaluate at P1 (a, b):A = f xx , B = f xy , C = f yy , D = AC − B 2
(a) If D>0 and A>0  Local minimum at ( a,b )
(b) If D>0 and A<0  Local maximum at ( a,b )
(c) If D<0: No extremum at ( a,b ) (we can say: Saddle point)
Remark: If D=0: no conclusion can be drawn
 EXAMPLE
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Example 7.3.3 (Basic): Study extrema of the function:

f ( x, y ) = x3 − y 3 + 6 xy
 ECONOMIC EXAMPLE
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EXAMPLE 7.3.4: A grocery store carries two brands of cat

food, a local brand that it obtains at the cost of 30 cents per
can and a well-known national brand it obtains at the cost of
40 cents per can. The grocer estimates that if the local brand
is sold for x cents per can and the national brand for y cents
per can, then approximately 70 − 5x + 4y cans of the local
brand and 80 + 6x − 7y cans of the national brand will be sold
each day. How should the grocer price each brand to
maximize total daily profit from the sale of cat food?
 EXAMPLE
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Two brands: 1st cost (x cents) of 30 cents/can, 2nd (y cents) 40

cents/can & 1st: 70 − 5x + 4y cans, 2nd: 80 + 6x − 7y cans sold.
 CONSTRAINED OPTIMIZATION
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Constrained optimization: Optimize z = f(x, y), called the

objective function subject to a (or  2) constraint (x, y) = 0

( 2007B )

Min, max P =
(
2 x2 + y 2 ),
1 + 2 xy + 2 y 2
x, y  R & x 2 + y 2 = 1
 LAGRANGE MULTIPLIERS
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Find max, min of z = f(x, y), g(x, y) = 0 & g(x, y): non – linears
Step 1: Combine the objective function and constraint into a
single function: Lagrange function L(x, y, ) = f(x, y) + g(x, y)

Step 2: Solve the next system of three L x = 0

equations, three variables x, y, . The 
L y = 0
L  = g ( x, y ) = 0
solution (x0, y0) is the optimal point: 
Step 3: Evaluate the value of f(x0, y0) …  min, max requested.

Economics problem: max (min). Only one (x0, y0)  Answer!

Example : Find max, min of function z = xy, subject to x 2 + y 2 = 8

 EXERCISE 27 (SECTION 7.3, 7.5)
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Q27 (Section 7.3). A company produces x units of commodity A

and y units of B. All the units can be sold for p = $(100 – x) per unit
of A & q = $(100 – y) per unit of B. The cost (in $) of producing
these units is given by C(x, y) = x2 + xy + y2. What should x, y be to
maximize profit?

Q27 (Section 7.5). When x thousand $ are spent on labor and y

thousand on equipment, the output is Q(x, y) = x1/3y2/3 units.
Suppose $120000 is available for labor and equipment. How should
the money be allocated between labor and equipment to generate
the max output?