Using Equations to Solve Business Probelms

One of the primary objectives of business mathematics is to describe business situations and solve business problems. Many business problems requiring a mathematical solution have been converted to formulas. A formula is a mathematical statement describing a real-world situation in which letters represent number quantities. By knowing the numerical value of any two of the three parts, we can use the formula to determine the unknown part. Formulas are a way of standardizing repetitive business situations. They are used in almost every aspect of business activity and are an essential tool for the businessperson. As valuable and widespread as formulas are, they cannot anticipate all business situations. Today businesspeople must have the ability to analyze the facts of a situation and devise custom-made formulas to solve business problems. These formulas are actually mathematical equations. In English, we write by using words to form complete thoughts known as sentences. Equations convert written sentences describing business situations into mathematical sentences. Equations express business problems in their simplest form. An equation is a mathematical statement using numbers, letters, and symbols to express a relationship of equality. Equations have an expression on the left side and an expression on the right side connected by an equal sign. A ratio is a fraction that describes a comparison of two numbers or quantities. In business, numbers often take on much more meaning when compared with other numbers in the form of a ratio. A proportion is a statement indicating that two ratios are equal. Proportions are equations, with as representing the equal sign.