Maxima and Minima (2nd derivative test)

Term Paper
Course Name: Mathematics for Business Decision
Course Code: BUS 5103

Prepared by (Group-04)
Sl. No ID Name
1 24230225008 Afsana Parvin Mim

2 24230225021 Suvojit Kumar Debnath

3 24230225022 Md. Zahid Hasan

4 24230225023 Shariful Mamun

5 24230225028 Md. Nazmus Sakib

Batch: MBA (Regular) - 24

Prepared for
Md. Ashraful Alam
Associate Professor
Department of Business Administration- General
Faculty of Business Studies

Date of Submission: 01-06-2024

 TABLE OF CONTENTS

1. Chapter One: Introduction 3

2. Chapter two: Background of the study 4-6

2.1 Derivative

2.2 First derivative, second derivative, and third derivative test

2.3 Maxima, Minima

2.4 Stationary points

2.5 Inflection Point

3. Chapter three: Necessity of second derivative test 6

4. Chapter four: Working procedure of the second derivative 7

5. Chapter Five: General and Business Application 8-13

6. Chapter Six: Conclusion 13

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 CHAPTER ONE

Introduction:

The second Derivative Test is one of the methods in calculus to find the maxima and
minima of a curve. Other than the second derivative test there is also a first
derivative, which can be referred to as a rudimentary version of the second derivative
test.

The first derivative test helps us find critical points for a given function but does not
tell us about the nature of the function at these points. We also come across cases
where we cannot get critical points as the first derivative test fails. The second
derivative test is used in these cases. The second derivative test tells us if the critical
point obtained is a point of local maximum or local minimum. The second derivative
test is also helpful in solving various problems in different fields such as science,
physics, and engineering. In this article, we shall discuss the second derivative test
in detail.

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 CHAPTER TWO

Background of the study:

Derivative
In mathematics, the rate of change of a function with respect to a variable is
derivative. Derivatives are fundamental to the solution of problems in calculus and
differential equations.
𝑑
• means the derivative with respect to x.
𝑑𝑥
𝑑𝑦
• means the derivative of y with respect to x. It is called the first derivative
𝑑𝑥
of y with respect to x.
𝑑
• [𝑓(𝑥)]=f'(x)
𝑑𝑥
𝑑2𝑦
• =f'’(x). It is called the second derivative of y with respect to x.
𝑑𝑥 2
• 𝑑3𝑦
=f’’’ (x). It is called the third derivative of y with respect to x.
𝑑𝑥 3

What is the Second Derivative Test?

The second derivative test is used to find the points of local maximum and local
minimum in those cases where the first derivative test fails. It involves
differentiating the function twice and then calculating its value on the critical points.
Thus, it must be noted that the second derivative test holds true for functions that
can be differentiated twice.

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Steps for Second Derivative Test for Maxima and Minima

Consider a real-valued function f(x) which is defined on a closed or bounded interval

[a, b]. Let k be a point in this interval.
In order to conduct the second derivative test on a function f(x), the following steps
are followed:
● Differentiate the function f(x) with respect to x to get f'(x).
● Now further differentiate f'(x) with respect to x to get f”(x) i.e. the second
derivative of f(x).
● Equate the value of f'(x) to 0 to get the values of x i.e. stationary points at
which f'(x) becomes zero.
● Now calculate the value of f”(x) at points obtained.

On calculating the value of f”(k), we can arrive at the following three conditions:

Case 1: Local Minima

If f'(x) = 0 and k is the required point, then if f”(k) > 0, the point k is said to be the
point of local minima.
The minimum value can be obtained by putting k in the main function.

Case 2: Local Maxima

If f'(x) = 0 and k is the required point, then if f”(k) < 0, the point k is said to be the
point of local maxima.
The coordinate of the maximum value can be obtained by putting k in the main
function.

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Case 3: Point of Inflection

If f'(k) = 0 and k is the required point, then if f”(x) = 0, the point k is said to be the
point of inflection, and the function is said to have no point of local maxima and
minima.

CHAPTER THREE

Necessity of Second Derivative Test:

CHAPTER THREE

The second derivative test is useful in the following cases:

● The second Derivative Test is used to calculate the points of local maxima
and local minima where the first derivative fails.
● It can also help us to determine the extremities of the curve.
● It can also help us to know about the orientation of a parabola.
● The second Derivative Test is handy for finding optimal solutions to
various problems in various fields such as physics, economics, and
engineering.
● The second Derivative Test also helps us determine the concavity and
convexity of the curve.
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 CHAPTER FOUR

Working procedure of the second derivative test:

The second derivative test is a useful method in calculus to determine whether a

critical point of a function is a local maximum, local minimum, or neither. Here is a
step-by-step procedure to apply the second derivative test:

1. Find the First Derivative: Compute the first derivative f'(x) ) of the function f(x).

2. Determine Stationary Points: Solve f'(x) = 0 to find the stationary points. These
are the points where the function's slope is zero or undefined.

3. Compute the Second Derivative: Find the second derivative f''(x) of the
function.

4. Evaluate the Second Derivative at Critical Points: Plug each critical point into
the second derivative f''(x):

● If f''(x) > 0 ) at a stationary point ( x = c ), then f(x) has a local minimum at ( c ).

● If f''(x) < 0 at a stationary point x = c, then f(x) has a local maximum at ( c ).
● If f''(x) = 0 at a stationary point x = c, the test is inconclusive, and one may need
to use other methods, such as the first derivative test or higher-order derivatives, to
determine the nature of the point.

5. Find the Inflection points: To find the inflection points, set the second derivative
equal to zero. Now, solve f”(x)=0 to find the inflection points.

6. Evaluate the third derivative to confirm the inflection points: Find the third
derivative f’’’(x) of the function. Plug each inflection point into the third derivative.

● If f’’’(x)≠ 0, then the point is indeed an inflection point.

● If f’’’(x)= 0, then compute more higher-order derivatives to find the first non-
zero derivative.
● If the first non-zero higher-order derivative is of odd order, then the point is
an inflection point.

The second derivative test thus helps to identify local optimum points and also
inflection points.

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 CHAPTER FIVE

General and Business Application:

1. Determine all local optimum points and all inflection points of y=-x3-12x2-45x+2
by the second derivative test.

Solution:
Given, f(x)= -x3-12x2-45x+2

.˙. f’(x)= -3x2-24x-45

.˙. f’’(x)= -6x-24

.˙. f’’’(x)= -6

To get the stationary points, Let, f’(x)= 0

⇒ -3x2-24x-45= 0

⇒ x2+8x+15=0

⇒ x2+5x+3x+15= 0

⇒ (x+3)(x+5)= 0

.˙. x= -3, -5

For x= -3,

f’’(x)= f’’(-3) = -6.(-3)-24= -6<0

So, f(x) has a maximum value at x = -3, and the maximum value is-

fmax= (-3)3-12(-3)2-45.(-3)+2= 2

For x= -5,

f’’(x)= f’’(-5) = -6.(-5)-24= 6>0

So, f(x) has a minimum value at x = -5, and the minimum value is-

fmin= (-5)3-12(-5)2-45.(-5)+2= -198

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To get the stationary points:

f”(x)= 0 Here,

⇒ -6x-24= 0 f’’’(x)= f’’’(-4)= -6≠ 0

.˙. x= -4

Coordinates of inflection point:

f(x)= f(-4)= -(-4)3-12(-4)2-45.(-4)+2= -74

So, the inflection point is (-4,-74).

Answer: Maximum point(-3,2)

Minimum Point(-5,-198)

Inflection point(-4,-74).

2. Find and classify extrema of the function 𝑓(𝑥)= 𝑒x + 𝑒-x +2cos(𝑥)

Solution:

x -x
f(x) = 𝑒 + 𝑒 +2cos(𝑥)

x -x
𝑓′(𝑥)= 𝑒 –𝑒 −2 sin(𝑥)

f′(x)=0 only when 𝑥=0

So, there is only one stationary point 𝑥=0.

x -x
𝑓′′(𝑥)= 𝑒 + 𝑒 −2cos(𝑥). Since 𝑓′′(0)=0, the second derivative test is inconclusive.

x -x
𝑓′′′(𝑥)= 𝑒 –𝑒 + 2 sin(𝑥). Since 𝑓′′′(0)=0, we still can't say anything about the point 𝑥=0.

(4) (4)
𝑓 (𝑥)=𝑒x +e-x + 2cos(𝑥). Since 𝑓 (0)= 4 >0 and the order of the derivative is an even
number, therefore, 𝑥=0 is a local minimum according to the Higher-Order Derivative Test.

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3.Determine all local optimum points and all inflection points of y=x3-6x2+12x-5 by
the second derivative test.

Solution: Given, f(x)= x3-6x2+12x-5

f’(x)= 3x2-12x+12

f’’(x)= 6x-12

f’’’(x)= 6

To get the stationary points, Let, f’(x)= 0

⇒ 3x2-12x+12= 0

⇒ x2-4x+4=0

⇒ (x-2)2= 0

.˙. x= 2

For x= 2,

f’’(x)= f’’(2) = 6*2-12= 0

So, at x=2, the test is inconclusive for the given function. The use of other methods, such
as the first derivative test or higher-order derivatives are needed to determine the nature
of the critical point. The graph of the given function shows why the 2nd derivative test fails
here.

It is an Inflection Point ("saddle point"). The slope does become zero, but it is neither a
maximum nor a minimum.

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4. When x gallons of olive oil are produced, the average cost per barrel is 𝑨(𝒙),
where

𝟒𝟎𝟎𝟎
𝑨(𝒙)=𝟎.𝟏𝐱+𝟐𝟎+ 0.25x, 𝒙 > 𝟎.

(a) Find the value of x that minimizes average cost per barrel.

(b) Compute the minimum average cost per barrel.

Solution:

(a) Given,
4000
𝑨(𝒙)= 0.1𝑥+20+ 0.25x, 𝒙 > 𝟎.

= 4000(0.1𝑥 + 20)-1 + 0.25𝑥

Now, 𝐴’(𝑥) = 4000 (−1)(0.1𝑥 + 20)-2(0.1) + 0.25

400
= −(0.1𝑥+20)2 + 0.25

∴ 𝐴’’(𝑥) = −400 (−2)(0.1𝑥 + 20)-3(0.1)

= 80(0.1𝑥 + 20)-3

For stationary points,

Let, 𝐴’(𝑥) = 0
400
⇒− + 0.25 = 0
(0.1𝑥+20)2

400
⇛ (0.1𝑥+20)2 = 0.25

0.25 1 1
⇒ (0.1x+20)-2 = =1000=(40)2
400

⇛ (0.1x +20)-2 =(40)-2

⇛ 0.1x+20 = 40

⇒ x=200

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Now,

(8×200)+1600 1
𝐴’’(200) = = 800> 0,which is positive
(20+20)4

So, the given function has a minimum value at 𝑥 = 200. (Answer)

(b)

Since, for 𝑥 = 200, 𝐴(𝑥) has minimum value. [From (a)]

So, the minimum average cost per barrel will be,

4000
𝐴min(200) =[(0.1)×200]+20 + {(0.25)×200}

= [4000/40] + 50

= $150 (Answer)

5. A manufacturer sells x units of a product at a dollar price of p = 6565 −10x − 0.1x 2

per unit. The cost of manufacturing the product is C(x)= 0.05x 3 -5x2 + 20x+ 250000,
0 ≤ x ≤ 150. How many units should be produced and sold to maximize the resulting
profit?

Solution:

Total revenue = (Price per unit) × (Number of units sold)

R (x)= (6565−10x − 0.1x2 ) × x = 6565x −10x2− 0.1 x3

Profit, P(x) = Revenue – Cost

=(6565x- 10x2-0.1x3 ) - (0.05x3-5x2+20x+250000)

= -0.15x3-5x2+6545x-250000

To determine the quantity x that maximizes the profit function, we first find,

𝑑𝑃
= -0.45x2-10x +6545
𝑑𝑥

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Setting this first derivative to be equal to zero, we solve for critical values of x and x = 110
(Other root is negative).

𝑑2𝑃
Now, = −0.9x-10
𝑑𝑥2

= -(0.9)(110)− 10

=− 109 < 0 ; indicating that this critical value does indeed represent a
maximum.

P(110) = - 0.15(110)3 –5(110)2 + 6545(110) – 250000

= $209800. (Answer)

CHAPTER SIX
Conclusion:
In conclusion, the second derivative test is a fundamental tool for determining the
local maxima and minima of a function. By utilizing the second derivative, we can
ascertain the concavity of a function at critical points, allowing us to classify these
points as local maxima, minima, or points of inflection. This method, when
combined with the first derivative test, offers a robust framework for analyzing the
behavior of differentiable functions.

Furthermore, the extension to higher-order derivative tests provides additional

precision in cases where the second derivative may be inconclusive, enriching our
analytical toolkit. The second derivative test's relevance extends beyond theoretical
mathematics into practical applications, particularly in fields like economics and
business. For instance, optimizing profit functions, minimizing costs, and enhancing
production efficiency all rely on accurately identifying optimal points through these
mathematical techniques.

Thus, mastering the second derivative test not only deepens our understanding of
calculus but also equips us with essential skills for solving real-world problems.

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