Essay on Importance of Business Math in Business
Business mathematics is mathematics used by commercial enterprises to record and manage business operations. Commercial 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.
In academia, "Business Mathematics" includes mathematics courses taken at an undergraduate level by business students. These courses are slightly less difficult and do not always go …show more content…
Market analysis is one of the core elements of a business plan. Understanding the needs of a consumer base, as well as your competitor's strengths in the market is knowledge that can give an edge to your business. You must analyses data from questionnaires, as well as from official sources like the Census Bureau and use your statistical skills to group them and convert them into percentages to discover the consumers' trends and your piece of the market pie chart.
Measuring Economic Performance:
The Gross Domestic Product, commonly known as the GDP, is the sum of private consumption plus government spending plus gross investment plus the difference or exports minus imports. It's a lot of additions and in a failing economy subtractions, for which you need math skills to compute. To find the GDP per capita, you must divide the nominal GDP by the country's population. Furthermore, the growth or shrinking of an economy is evident when subtracting the newest GDP estimates with older data.
Understanding Inflation and Interest Rates:
Interest rate is the percentage of surplus value a borrower has to give the lender. A quite simplistic example of an interest rate is when a borrower receives $100 with a 3 percent interest and has to repay $103. Another occasion when math knowledge on percentages is helpful in economics is when you must calculate the future prices of products…