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Next: 5. Up: Business Previous: 3.

4. Increasing, decreasing and turning points

When presented with a mathematical model for a business process (costs, profit, sales, market share etc), you should subject that model to a reality check - does the behavior of the model coincide with common sense?

A good reality check is to see if the functions increases or decreases as expected.

Increasing and decreasing are concepts captured by the derivative.

If the derivative is positive then the function is increasing.

If the derivative is negative then the function is decreasing.

If the derivative is 0, then it's neither increasing nor decreasing so it's flat!


next up previous
Next: 5. Up: Business Previous: 3.
Richard Waterman
1999-05-24