Application of Matrices and Linear Programming in Economics

Abstract

Matrix play an important role in analyzing most complex problems for instance, it is used to find the production level in describing the quantum mechanics of atomic structure, relationship and even used in plotting complicated dance steps. Similarly, it is used to keep track of coefficient of linear transformation structure of complicated systems and also used to describe linear equation. However, making use of the simplex method makes the optimization problem very easy to interpret. Matrix theory is a branch of mathematics which enables the use of linear programming to obtain solutions to problem in the economics sector. The use of the simplex method makes it easier in economics computation where cost and profits can be calculated. The objectives of this study are to investigate the application matrices and linear programming in economics and to reveal the techniques of applying matrix in solving economics problems. The use of matrix in various field of study especially economic is very necessary. The simplex method which is now on interactive computation procedure has more advantage over other matrix methods such that, it can be used to solve linear optimization problems whose constraints are inequalities while Crammer’s rule and Jacobian’s method are used in solving systems of linear equations. This study reported that the use of the simplex method makes it easier to interpret economics and business results earlier. In addition, economists need to make use of matrix in work in the computation of economic theories. The study found that economists could also make use of equation to represent the relationship between economics variables. Graphs are drawn to illustrate the nature of this relationship. The authors also reported that matrixes could be used by economists in solving demand and supply challenges and also through the use of equations to find the equilibrium price of goods. The authors suggested that matrix should be use by the mathematicians to go into the economy of the nation. Keywords: Matrix Theory: Linear Programming: Business Sector: Economics: Simplex Method: Mathematics.