Chapter 1A/ Classifying Data

- Relating the world through data

- Quality > descriptive
- Quantity > countable

Variables:
Categorical Numerical
Nominal Ordinal Discrete
Continuous
Naming, eg. colours Order, eg. shoe size Countable Measurable
Chapter 1B/ Distributions of categorical data
Frequency Table:
- Sorts categorical data in an organised form
- Lists values of variables and how many times they occur
- Percentage of times a value occurs (percentage frequency)
Percent = count/total count x 100%

Bar Chart:
- Shows data from frequency table on a graph
- Displays categorical data
- Freq/percentage, frequency on y-axis, frequency shown by the height of bars
- Helps to see any stand-out data

Stacked or segmented bar charts:

- Used to show the difference between 2 or more categorical variables
- Bars stack on each other
- Height of bar gives total frequency
- Percentage of segmented bar chart shows length of segments given by percentages

Mode:
- Most frequently occurring value

Writing a Report:
- Describe the content and number of individuals
- Include frequency and percentage frequency
- Talk about/mention mode
Chapter 1C/ Describing and displaying numerical data
When continuous data sets are large, smaller groups within are used
EXAMPLE:
35.0, 48.0, 45.0, 43.0, 38.2, 50.0, 39.8, Average hours Frequency
40.7, 40.0, 50.0, 35.4, 38.8, 40.2, 45.0, worked Number percent
40.0, 43.0, 48.8, 43.3, 53.1, 35.6, 44.1, 34.8 30.0 – 34.9 1 4.3
35.0 – 39.9 6 26.1
40.0 – 45.9 8 34.8
45.0 – 49.9 5 21.7
50.0 – 55.9 3 13.0

Reading a Histogram:
Shape:
- Symmetrical (one peak, double peaked)
- Outliers (# by itself)
- Skewed (negative – trails to left,
positive – trails to the right)
- Centre (middle of graph/median is
symmetrical)
 Chapter 1D/ Using a log scale to display data
Logarithmic scales
- Pulls large data sets
- Spreads very small data sets

EXAMPLE:
LogValue Meaning Decimal
0.01(-2) 152 0.01
(5) 105 100000

USE CAS:
- Get log numbers
- Main
- Open keyboard
- Tap log, 10 at bottom, 45 in power spot
- Click exe
- Ans= 1.65321 OR 1.7

Log Value Mathematical Meaning Decimal Equivalent

-5 10-5 0.00001
-4 10-4 0.0001
-3 10-3 0.001
-2 10-2 0.01 Log to Decimal CAS:
-1 10-1 0.1 Log10(x) = Log value
0 100 0 Highlight
1 101 10 Interactive
2 102 100 Advanced
3 103 1,000 Solve
4 104 10,000 Decimal to Log CAS:
5 105 100,000 Log10(decimal)

Drawing a Histogram using CAS

16, 11, 4, 25, 15, 7, 14, 13, 14, 12, 15, 13, 16, 14
EXAMPLE
15, 12, 18, 22, 17, 18, 23, 15, 13, 17, 18, 22, 23
CAS STEPS:
- Menu
- Statistics Constructing histogram with log scale
- Fill column under “marks” - Stats
- From toolbar tap - Fill list 1
Draw: ON - Change List 2 to List 1
Type: Histogram -
XList: Main - Histogram – set
Freq: 1 -
- Tap - H-start = -2
- H-start 2, Hstep 4 - H-step = 1
- Tap for frequency of particular variable
Chapter 2A/ Summarising Numerical Data
Dot Plots:
- Display discrete numerical data
 Chapter 2B/ Median and Range

Median Range
(n+1)th term Highest score – lowest score
2 29-18
(13+1) = 11th term
2
= 7th term

18, 18, 19, 19, 22, 22, 22, 22, 23, 23, 24, 25 ect

Q1 Q3
Q2/med

Interquartile Range (IQR): FINDING Q1 AND Q2:

IQR= Q3 – Q1 Q1= half of 1st part = n+1 = #
2
Q2 = half of 2nd part = n+1 = #
Stem plot form: 2
Stem leaf
1 8
2 0257899
3 13
Chapter 2C-2D-2E/ Dot plots, Five number summary and Describing and comparing Box plots

min Q1 med Q3 max outlier/s

Five number summary:

1. Min
Describing centre and spread:
2. Q1
x = mean
3. Med
x = everything given
4. Q3
n = number of things given
5. Max

Using CAS:
Standard deviation: Box Plot:
- Menu - Menu
- Statistics - Statistics
- Fill first column with data eg. height - Type temp in list name
- Tap calc on tool bar - O.K
- One variable - Tap
- X list: main/height - Draw: ON
Freq: 1 Med Box
- O.K X list: main/temp
- x = number (for last example = Freq: 1
167.25 > mean) Outliers: ON
- Sx = number (for last example = - Tap
6.67 > standard deviation) - Tap
- X selector will show answers
Chapter 2G/ Normal distribution, curve and 68-95-99.7%
- Deals with standard deviation and mean
- Deals with symmetric distribution and has a bell shape
- data like intelligence, height ect

34% 34%

2.35% 2.35%

0.15% 0.15%

EXAMPLE:
Delivery time for pizza is normally distributed with a mean of 25mins and the standard
deviation of 5mins.
a. What percentage of pizzas have a delivery time between 15-35mins?

= 95%

10 15 20 25 30 35 40

b. How many pizzas were delivered between 15-35 mins out of 200 pizzas?
200 x 0.95
Chapter 2H/ Standard Scores ( z )
- Changes data to new forms and helps find standard deviations lies from the means

To find the standard scores:

z= x – x
s

standard mean
score standard
actual deviation
score

EXAMPLE:
Subject mark ( x mean ( standard dev. standard s
) x)
Psych 75 65 10 1
Statistics 70 60 5 2

a. In what subject did the student do better?

= The student did better in statistics
Psych Statistics
z= x – x z= x – x
s s
z = 75 – 65 z = 70 – 60
10 5
=1 =2
Chapter 3A/ Investigating associations between 2 variables
Bivariate data: link between two variables which change together

number of hours of study and marks obtained

= explanatory variable
= response variable

Explanatory variable explains/predicts the response variable

Chapter 3B/ Association between 2 categorical variables
EXAMPLE: Attitude to gun control based on sex
Ev
RV
Raw data #>% New data
Male Female Male Female
Against 26 12 Against 44.8% 28.6%
For 32 30 For 55.1% 71.4%
Total 58 42 Total 100 100 In a report mention:
Intro sentence
Difference of 10 or more = association
Statistics
Difference of >10 = no association
Concluding sentence
a. Is a person attitude to gun control associated with sex?
From the table we see that a much higher percentage of females were for gun control than
males. 71.4% of females were for gun control rather than 55.1% of males. This
demonstrates that women are more for gun control than men, and this view is
demonstrated by sex
Chapter 3C/ Relationships between variables
- Categorical and numerical variables

To represent:
- Use parallel box plot
- Parallel dot plot
- Back-to-back stem plot

To compare distributions of various types:

- Shape
- Centre
- Spread

Use of CAS:
Participation rate % 26, 30, 36, 1, 25, 9, 30, 3, 35
Hours worked 35, 43,38, 50, 40, 50, 40, 53

- Menu
- Statistics
- Label columns P (participation) and H (hours)
- Fill variables
- Go to
- Fill the box
Draw: ON
Type: Scatter
X list: main/P
Y list: main/H
Freq: 1
Mark: Square
- SET
- Tap
- Full screen, resize to see full graph
Chapter 3E/ How to interpret a scatter plot
A scatterplot shows some sort of relationship and pattern
- Dots all over the place = random, no clear pattern no clear relationship
- = 3 types of relationships exist

What to look for in a scatter plot:

1. Direction and outlier
Random, no
relationship, no
outlier

Clear pattern, Strong positive relationship:

positive relation, r between 0.75 and 0.99
no outliers Moderate positive relationship:
r between 0.5 and 0.74
Clear pattern, Weak positive relationship:
negative relation, r between 0.25 and 0.49
no outliers No relationship:
r between -0.24 and +0.24
Weak negative relationship:
2. Form r between -0.25 and -0.49
Linear form Moderate negative relationship:
r between -0.5 and -0.74
Strong negative relationship:
r between -0.75 and -0.99
Linear form

Non-linear form

3. Strength – measured with Pearson Correlation Coefficient - numeric and linear

r = no association

r = +1
Positive linear relation
 r = -1
Negative linear relation

Chapter 3F/ Calculating the correlation coefficient (r)

CAS:
- Menu
- Statistics
- Fill list1 with row 1 example, list2 with row 2
- Calc
- Exe
- OK
- Look for r in the results

Chapter 3G/ Coefficient determination (r2)

- Usually, a statistic eg. %
- Predicts variation in one variable eg. weight by variations
- Can be calculated by formula, equal to r2

EXAMPLE: Correlation between weight and height is r= 0.8, find the coefficient of
determination
= r2
= (0.8)2
= 0.64
= 0.4 x 100
= 64%
Chapter 3H/ Correlation and casualty
Correlation tells you about the strength of the association between variables, not the source
of the cause
Establishing causality: Treatment 1: lesson on
Group 1 time series
Randomly allocate a
Give test on time
group of students in to
series
two groups Group 2 Treatment 2: lesson on
Shakespeare

Group 1 has an advantage during the test because they had the lesson on time series.
Remember: the lesson done is the EV as the test depends on it, making the test the RV

Possible non-causal explanations for an association:

Sunscreen
Temperature *Observed association

Fainting
Common response because on hot days it is likely people put sunscreen and some faint.
Putting sunscreen on and fainting both have the same response to temperature (hot day)

Confounding variables:
Unemployment
Economy *Observed association
Cause?
Crime

Unemployment and crime are in confounded situation because despite both being
interrelated, they. May be affected by some other factor such as economy downturn. Actual
cause is unknown.

Coincidence:
Incidents happen without relation to each other (coincidentally) eg. eating butter and
getting divorced

Which graph to use:

Types of variables
Response variable Explanatory variable Graph
Categorical Categorical Segmented bar chart,
parallel bar chart
Numerical Categorical Parallel box plot, parallel
dot plot
 Numerical Categorical (two categories Back-to-back stem plot,
only) parallel dot or box plot
Numerical Numerical Scatter plot

Chapter 4A/ Least squares regression

Regression
line
(x5, y5)
d5 A point
(x3, y3)
d3
(x2, y2 (x4, y4)
d2 d4
distance ‘d’ is from regression
line is called the residual
d1
(x1, y1)

- Least squares regression line MINIMISES the sum of squares of residuals

- Can’t minimise residuals only as this will give zero
2 2 2 2 2
The sum of the squares of the residuals = d , d , d , d , d
1 2 3 4 5
Three assumptions of data to be able to fit least squares line:
- Numerical
- Linear Same conditions as correlation coefficient
- No outliers
Chapter 4B/ Determining the equation of the least squares line
Two methods to determine equation of least squares regression line
Use the formula (pt 1)
Use CAS – for graph (pt 2)
1- Formula: r = correlation coefficient
The equation of least squares regression line is: y = a + bx sx & sy = standard deviation of x and y
rsy x & y = mean values of x and y
The slope (b) is: b =
Sx
The intercept (a) is: a = y – b x

EXAMPLE: The heights (x) and weights (y) of 11 people have been recorded. The values of
the following have been determined:
x = 173.3cm sx= 7.444cm y = 65.45cm sy= 7.594 r= 0.8502
Use the formula to determine the equation of the least squares regression line that enable
weight to be predicted based on height. Calculate the slope and intercept correct to two
significant figures
Slope Intercept
x = 173.3cm
rsy a = y – bx
sx= 7.444cm b=
Sx = 65.45 – 0.867 x 173.3
y = 65.45cm
0.8502× 7.594 = -85 (corrected to 2 sig. fig.)
sy= 7.594 =
7.444
r= 0.8502
= 0.867 (corrected to two 2 sig. fig.) y= -85 + 0.87 x
or
weight = -85 + 0.87 x height

2- CAS
EXAMPLE:
(x ) height (cm) 177 182 167 178 173 184 162 169 164 170 180 (EV)
( y ) weight (kg) 74 75 62 63 64 74 57 55 56 68 72 (RV)
a. Determine and graph the equation of least squares regression line that will enable
wight to be predicted from height. Write the intercept and slop correct to 3 sig. fig.
Steps:
- Menu
- Tap calc
- Statistics
- Fill
- Column 1: height, column 2: weight
XList: height
- Tap
YList: weight
- Fill
Freg: 1
Draw: ON
Copy Formula: y6
Type: Scatter continued
Copy Residual: OFF
XList: Height
- OK
YList: Weight
- R2 is the coefficient of determination
Freq: 1
-
 - Set
- Tap

Chapter 4C-D/ Full regression analysis

1. Decide the ev and rv
2. Construct the scatter plot
3. Calculate the correlation coefficient > strength of the relationship
4. Determine regression line equation
5. Interpret the coefficients of least squares regression line
 y=a+bx and y (int), b (slope)
6. Coefficient determination to get the power of association
7. Regression line to make predictions
8. Calculate residuals, use plot to find assumptions of linearity
9. Write report findings

EXAMPLE: Predict the price of second-hand car based on age

a. Label the RV and EV
RV: price
EV: age

b. Scatter plot (with cas)

c. Correlation coefficient
R2 = -0.964

Report
1. Type of association
Strong negative linear
2. Equation of least squares regression
Y=a+bx = price
= 35,100 – 3940 x age
3. Interpret of coefficients
5.5 yrs = $13,430
4. coefficient of determination
5. calculate the residual
actual – predicted
Chapter 5A/ Transformations
Chapter 5B/ Squared transformation
EXAMPLE: Height of base jumper for first 10sec
Time 0 1 2 3 4 5 6 7 8 9 10
Height 1560 1555 1540 1516 1482 1438 1383 1320 1246 1163 1070
(cm)

a. Construct a scatterplot of height (RV) against time (EV)

b. Linearise use x2 to transform data and fit least squares. Then determine the equation
c. Using the equation to predict height of base jumper if time is 3.4sec

CAS Steps:
- Menu
- Stats
- Fill lists 1, 2, 3
EV RV Transformed Time
Time Height Timesq
- Tap
- List 1: time
List 2: height
- Click
- Calc
- Regression
- Linear regression
- OK
- Transformed equation:
y=a+bx
height = -4.90
1559.99 x time2
Chapter 5c/ Log Transformation
CAS Steps:
1. Go to stats
2. Fill table
3. Name the thirds list on CAS LogGDP
4. Place cursor in the calculation cell at the bottom and type log (GDP)
5. GDP is the explanatory variable (x) and lifespan the response variable (y)
6. Construct the scatter plot draw: on
7. Tap to view scatterplot Complete stats spread
type: scatter
(set to linear) x list: main/Log GDP
8. Go to Calc > regression > linear y list: main/Lifespan
Regression to find Least Squares Freq: 1 Square
Chapter 5d/ Reciprocal Transformation
A. Compresses the upper end of the scale on the y axis or the x axis

1/y - the reciprocal y transformation

- compressed larger values of y relative to lower values of y

B. The reciprocal x transformation works the same way, but in the x-direction

Example:
Length 1.8 2.0 2.5 3.0 3.5 2.6 2.0 1.9
Width 6.8 5.6 4.6 4.2 3.5 4.0 5.0 5.5
Use 1/y Transformation
1. Increase the data and fit regressive line to transform the data (length is the ev)
2. Write its equation in terms of the variable lengths and widths
3. Use the equation to predict the width with a length
CAS Steps:
4. Main, tats, Fill third column name as Re-width
5. Place curser at the bottom of the third column and Length Widt Re-
type 1/width (this calculates the reciprocal values h width?
of the width) 1.8 6.8
6. Length is EV, width is the RV 2.0 5.6
7. Go to and sketch the scatterplot 2.5 4.6
8. Complete the stats spread type: scatter 3.0 4.2
9. Tap to get scatter plot x list: main/length 3.5 3.5
y list: main/width
2.6 4.0
To calculate regression: Freq: 1
Square mark 2.0 5.0
10. Calc 1.9 5.5
11. Regression
12. Linear regression a = 0.0694756
b = 0.0447213
13. Set calculator to X list: main/length r = 0.9381955
Y list: main/width r2 = 0.8802108
Freq: 1 y = a+bx 1/width=0.045 + 0.069 x L
*** : y1 1/width = 0.045 + 0.069 x 5
Copy residual: off 1/width = 0.390
Width/0.390 = 2.56cm
Chapter 6A/ Time Series – Investigating and Modelling
a. Trend – Long term upward and downward movement

b. Cycle – Periodic movements that last more than 1 year

cycle

c. Seasonally – calendar based periodic movement

Eg. A year, month or week

d. Structural Change – Sudden change in patterns of the plot

e. Outliers – single values stand out from the rest of the data

f. Random (regular) fluctuations – show all variants and can be unpredictable

Chapter 6b/Smoothing Time Series Using Moving Means
A. Smoothing (or reducing fluctuations) can be done by moving the mean

B. The Three-moving Mean

 Smoothed y2= y1+y2+y3
3

C. The Five-moving mean

 Smoothed y3= y1+y2+y3+y4+y5
5
Example: y1 y2 y3 y4 y5 y6 y7
Day Mon Tues Wed Thur Fri Sat Sun
s
Tem 18.1 24.8 26.4 13.9 12.7 14.2 24.9
p
a. Calculate three-mean smoothed temperature for Tuesday
=Mon + tues + wed
= 18.1+24.8+26.4
3
= 23.1

b. Calculate the five-mean smoothed temperature for Thursday

=Tues + wed + thurs + fri +sat
=24.8+26.4+13.9+12.7+14.2
5
= 18.4

D. Two-moving mean with centring

Chapter 6d/ Seasonal Indices
When data is seasonal, de-seasonalising it is important. This is done by calculating seasonal
indices

Sum of Seasonal = Number of

Indices Seasons

 Seasonal Indices tell us how a particular season compares to the average season
o Eg. Season Index for February is 1.2. This tells us that Feb figures are 20%
higher than the monthly average

To de-seasonalise use the formula:

De-seasonalised = actual figure
data/figure seasonal index
Example:
Seasonal Index (for cold drink sales) = 1.33
Actual drink sales = $15,652
Find the de-seasonalised sales
Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec
1.1 1.2 1.1 1.0 0.95 0.95 0.9 0.9 0.85 0.85 1.1 1.1
Number of seasons = 12.0
Formula 1. De-seasonalised:
De-seasonalised = actual figure
data/figure seasonal index

Formula 2. Re-seasonalised:
Re-seasonalising figure = de-seasonalised x seasonal index
Actual figure

Example: Seasonal index for cold drinks for spring is: SI = 0.85
De-seasonalised cold drink sales totalled: $10,870
What were the actual sales?
Actual figure (re-seasonalise) = de-seasonalised figure x SI
= 10,870 x 0.85
= $9,239.50

Example 2 (handout sheet)

Use the seasonal indices shows to de-seasonalise the sale figures
SI: Summe Autumn Winter Spring
YR Summer Autumn Winter Spring r
1.03 1.15 1.30 0.52
 1 920 1085 1241 446
2 1035 1180 1356 541
3 1299 1324 1450 659

Q2. Autumn: 1085 ÷ 1.15 = 943

1180 ÷ 1.15 = 1026
1324 ÷ 1.15 = 1151
Chapter 6e/ Fitting a trend line and forecasting
If the trend in the time series data appears to be linear, least squares regression method can
be used to fit a line to the data

Example: Fit the trend line to the data given in the table
(can write the years (y values) as 1, 2, 3 ect)
Number Year A. Find the least squares regression line
of schools a. 2169.4
2149 1981 b. -12.5
2140 1982 c. Y=a+bx
2124 1983 Number schools = 2169.4 – 12.5 x year
2118 1984 B. (Forecasting) How many schools do we predict
2118 1985 for VIC in 2015 if the same decreasing trend
2114 1986 continues? Give number to the nearest whole
2091 1987 number
2064 1988 1981 + 10 + 10 2001 -> 2015
2059 1989 2169.4 – 12.5 x 35
= 1732 schools on 2015
2038 1990
2029 1991
2013 1992
 Chapter 8A/ Modelling, Growth and Decay using recursion
Sequences: succession of numbers written (terms)
Eg. random sequence
12, 22, 5, 6, …

numbers continue
term

first term
Eg. rule: add 2

Rule based
1, 3, 5, 7, 9, …
sequence

Example: Write the first five terms if the sequence of starting value of 5 using the rule of
“double the number and subtract 3”
5 x 2 = 10 - 3 CAS steps
=7 1. Main
= 5, 7, 11, 19, 35 2. Type 5, press EXE
3. Type x 2 – 3
4. Continuously click EXE to
get the continuing
variables

Chapter 8B/ Recurrence relations

- Has a sequence rule
- Has 2 parts
» Starting term
» Rule generating successive terms in a sequence
- Rule can be shown in symbols, variables or any letter of alphabet
Eg. 10, 15, 20, … First term/value

Recurrence relation rule:

Vo=10, Vn+1 = Vn+5

Eg.
A. Generate first 5 terms of sequence using recurrence relation showing first 3 iterations
using manual method and cas
Vo=9, Vn+1 = Vn-4
V1= Vo-4
V1= 9-4
 = 5-4
= 1-4
= -3-4
= -7
B. How many terms formed one equation?
2

Chapter 8C/ Modelling linear growth and decay

- Linear Growth Increase by the same amount eg. simple interest
- Linear Decay Decrease by the same amount eg. depreciation

- General Rule Linear Growth Vn+1 = Vn+D

Linear Decay Vn+1 = Vn-D

Linear Growth – Simple Interest: Recurrence Model

Vo = Principle, Vn+1 = Vn+D, D= r/100 x Vo

Amount
borrowed or
invested
EXAMPLE: $5000 for which 4.8% is paid as simple interest
a. Model this using recurrence relation
Vo = 5000, Vn+1 = Vn + 240

b. What is the investment after 5 years?

$5,720

c. When will the investment first exceed $6000, what will its value be?
After 5 years it will be $6,200

Linear Decay (Depreciation)

Vo= (initial value of asset), Vn+1 = Vn-D, D= r/100 x Vo

EXAMPLE: A car was purchased for $24,000 in 2014. It depreciates by 20% each year
a. Model this depreciation in a recurrence relation form
Vo= 24,000
D= 20%

b. Determine the value of the car after 2 years

$14,400

c. From 2014, when will the cars value depreciate to $0

After 5 years, in 2019 it will be worth $0
Chapter 8D/ Rules for the nth term in sequence modelling linear growth/decay

Simple Interest: Investments and Loans:

Vn = Vo+nD, initial value
D = r/100 x Vo
OR
Vn = Vo + n x r/100 x Vo
Flat Rate and Unit Cost Depreciation:
Vn = Vo-nD
D= r/100 x Vo
OR
Vn = Vo – n x r/100 x Vo
EXAMPLE: The recurrence relation to model simple interest investment is:
Vo = 3000, Vn+1 = Vn+ 260 *Starting amount

a. What is the principle? How much interest is added to the investment each year?
Principle=$3000
Interest= $260

b. Write the rule for n years of investment

Vn= 3000+ n x 206
⇩ or simplified
Vn= 3000+260n
c. Use the rule to find value of investment after 15 years
Vn= 3000+ (15) x 260
$6,900

d. Use the rule to find when the value of the investment exceeds $10,000
Vn = Vo + nD
CAS steps
10,000 = 3000 + n x 260
i. Action
ii. Interactive
iii. Equation
iv. Solve (10,000
= 3000 + 260x,
x) EXE
Chapter 8E/ Modelling geometric growth and decay
- Geometric growth – increase of something by same percentage
» Vn+1 = RVn, R>1
- Geometric decay – decrease of something by the same percentage
» Vn+1 = RVn, R<1
- Recurrence model for compound interest/loans compounded yearly
» Vo = Principle
» Vn+1 = RVn, R = 1+ r/100
EXAMPLE: Recurrence relation which models compound interest of $2000 and interest of
7.5% per annum
Vo= principle, Vn+1 = RVn, R= 1+r/100
Vo= 2000, Vn+1 = 1.075 x Vn
a. Use recurrence relation to find the value of the investment after
i. 1 year
7.5/100
0.075+1 = 1.075

2000 exe
X1.075 exe = $2,150
ii. 2 years

Press exe from last answer

= $2311.35

iii. 3 years
Press exe from last answer
= $2,484.59

b. Value of investment when first exceeding $2,500

After 4 years
Exe after last answer = $2670.94

c. Write the recurrence relation if $1,500 invested at compound interest of 6% per

annum
Vo = 1500, Vn+1= 1.06 Vn

EXAMPLE 2: Compound interest with different compounding periods

Quarterly: 4 Monthly: 12 Weekly: 52 Fortnightly: 26
Annually: 1 Bi-annually: 2
Brian borrowed $5,000, with interest to be paid at a rate of 4.5% per annum. Write the
recurrence relation to model the loan
a. Yearly
Vo= 5000, Vn+1 = 1.045xVn
b. Quarterly
4.5/4= 1.125% 1.125/100= 0.0125+1 Vo=5000, Vn+1 = 1.0135xVn
c. Monthly
4.5/12=0.375% 0.375/100= 0.00375+1 Vo=5000, Vn+1 = 1.00375Vn
8E continued (Recurrence model for reducing balance depreciation)
Vo= Initial Value, Vn-1= RVn, R= 1/100

EXAMPLE: Recurrence relation to model value of office furniture valued at $6,900

depreciating at reducing balanced rate of 7% per annum.
Vo= 6900, Vn-1 = 0.93 x Vn
a. Use recurrence relation to find value of furniture after
i. 1 year
6900 exe
X0.93 exe = $6,470

ii. 2 years
Exe from last answer
= $5,967.81

iii. 3 years
Exe from last answer
= $5,550.06
b. When the value of investment was first less than $5,000
After 4 years
= $4,800.25

c. Write recurrence relation if furniture was initially valued at $7,500 depreciating at

balanced rate of 8.4% per annum.
Vo= 7500, Vn-1 = 0.916 xVn
 Chapter 8F/ Rules for the nth term in a sequence modelling geometric growth/decay
1) Rule for individual terms of geometric growth/decay sequence
a. Geometric growth and decay
Vo= Starting value, Vn+1=RVn

b. Value of nth term sequence

Vn= Rnx Vo

2a) Compound Interest loans/investments

c. Vn+ Rn x Vo
Or
d. Vn= (1+r/100)n Vo

2b) Reducing balance depreciation

a. Vn=RnVo
Or
b. Vn= (1-r/100)n Vo

EXAMPLE: Principal value of $10,000 earning compound interest at a rate of 9% per annum.
Vn= 1.09n x 10,000
Find:
a. The value of the investment after 4 years (to the nearest cent)
10,000 exe
X 1.09^4 = $14,115.82

b. Interest earned after 4 years

Interest = amount – principal
= 14,115.82- 10,000

c. Interest earned in the 4th year

d. If interest compounds monthly instead of yearly, write the rule for value of
investment after a month

e. The rule to get the value of investment after 4 years (48mths)

Chapter 8G/ Nominal and Effective Interest Rates
Nominal Interest Rate:
» Compound interest (annual) rate (%)
» Calculated on different time periods (compound periods)
 Monthly = 12
 Quarterly = 4
 Fortnightly = 26
 Weekly = 52
Nominal interest = compound interest ÷ compounding period
rate rate

EXAMPLE: Interest rate paid at 3.6% per annum. Convert this interest rate to:
a. Monthly rate
3.6 ÷ 12 = 0.3%

b. Fortnightly rate
3.6 ÷ 26 = 0.138%

c. Quarterly rate
3.6 ÷ 4 = 0.9%

Effective Interest Rate:

- Interest earned after 1 year
- Expressed as a percentage of amount borrowed/invested
r effective = ((1+r/n/100)n-1)x100%

Effective interest rate Nominal Number of

interest rate compounding period

EXAMPLE: Brooke borrows $20,000 and decides on two loan options

Option A: 5.95% per annum compounding weekly
Option B: 6% per annum compounding quarterly

a. Calculate effective interest rates for each investment option

Faster option a:
Option a: ((1+5.95/52/100)^52-1)x100
- Action
= 6.12%
- Financial
- Interest conversion
- convEff
- convEff(52,5.95) = 6.12%
Option b: ((1+6/4/100)^4-1)x100 = 6.13%

b. Which option is best and why?

Option A, as the interest rate is lower
Chapter 9A/ Combining Geometric Growth and Decay
- Involves linear and geometric growth and decay
o Eg personal load

Vo= Starting value, Vn+1 = RxVn ±D

EXAMPLE: Number of trout in fish farm after n months. Tn can be modelled by recurrence
relation To = 10,000, Tn+1 = 1.1 x Tn – 3000
a. Use recurrence relation to determine number of trout after 2 months
10000 exe
Ans x 1.1-3000 = 8000
Ans x 1.1-3000 = 5800 in the pond after 2 months

b. After how many months will there be no trout left

Ans x 1.1-3000 = 3380
Ans x 1.1-3000 = 718
Ans x 1.1-3000 = -2210.2
= after 5 months
Chapter 9B/ Amortisation and Reducing Balance Loans
- Regular payments done until a loan reaches 0

Modelling Reducing Balance Loans:

Vo= Principle, Vn+1=RVn – D, R=1+r/100

EXAMPLE: Alyssia’s loan modelled by recurrence relation

Vo= 1000, Vn+1=1.0125Vn – 257.85
a. Use CAS to get recursively the balance of the loan after making each 4 payments
1000 exe
Ans x 1.0125-257.85 = $754.65
Ans x 1.0125-257.85 = $506.23
Ans x 1.0125-257.85 = $254.71
Ans x 1.0125-257.85 = $0.0449

b. Find the balance of the loan (what’s still owed) after two payments, to the nearest
cent.
$506.23

c. Is the loan fully paid after 4 payments? If not, then how many payments are still
left?
No.
257.85+0.0448 = $257.89

Amortisation:
- Amortising loans are paid regularly until the loan reaches 0

EXAMPLE: Alyssia’s loan = $1000

Interest charged = 1.25% each month
Four monthly payment of = $257.85
Principle Interest paid Principle reduction Balance of loan
$1000 1.25% $257.85 - $12.50 $1000 - $245.35
1.25x1000 = $245.35 = $754.65
= $12.50
Chapter 9C/ Using a Finance Solver to Analyse Reducing Balance Loans
- Eg. home loans -> whole amount paid in small payments over a number of years
- Finance Solver: is to be used for reducing balance loans

Steps:
- Menu
- Financial
- Compound Interest

N: (Number of payments)
I%: (Interest rates)
PV: (Current loan investment)
PMT: (Amount paid each time)
FV: (Future value)
P/Y: (Number of payments per year)
C/Y: (Number of payments per year)

RULES:
- Someone pays you (POSITIVE)
- You pay someone (NEGATIVE)
- Bank gives you money (POSITIVE)
- You give bank money (NEGATIVE)

EXAMPLE: Andrew borrows $20,000 at an interest rate of 7.25% per annum, compounding
monthly. The loan will be repaid in 4 years with payments of $481.25 each month
a. How much will Andrew owe after 3 years
$5554.36

b. What is the final payment to be made after 4 years?

N: 48
I%: 7.25
PV: 20000
PMT: -481.25
FV: SKIP FV= 0.11c
P/Y: 12 481.25 – 0.11
C/Y: 12 = $481.14
Chapter 9D/ Interest Only Loans
- Borrower pays only interest charged on the loan
- Loan amount remains unchanged
Payment = interest changed
D= r/100 x Vo

EXAMPLE: Jane borrows $50,000 to buy some shares. Jane negotiates an interest only loan
for this amount, at an interest rate of 9% per annum compounding monthly
a. What is the monthly amount Jane will be required to pay?
9%/12 = 0.75%
D= 0.75/100 x 50,000
D= $375 paid monthly
Chapter 9E/ Annuities
- Amount of money left in the investment

A recurrence relation that can be used to model the value of an annuity after n payments,
Vn is:
Vo = Principal, Vn+1 = RVn-D
Where R= 1+r/100

EXAMPLE: Reza’s annuity can be modelled by the recurrence relation

Vo = 12,000, Vn+! = 1.005Vn – 2035
Where Vn is the value of the annuity after n payments have been received
a. Is the annuity fully paid out after six monthly payments have been made? If not, how
much will the last payment have to be to ensure that the annuity terminated after 6
months?
12000 x 1.005 – 2035 = 10025
10025 x 1.005 – 2035 = 8040.12
8040.125 x 1.005 – 2035 = 6045.33
6045.325625 x 1.005 – 2035 = 4040.55
2015.7550143906 x 1.005 – 2035 = 0.883789
= $6045.33 (to the nearest cent)

Amortisation tables for annuities: (bases on Reza’s recurrence relation)

Vo= 12,000, Vn+1= 1.005Vn – 2035
0.005 is r OR 0.5%
Payment number Payment Interest earned Principal Balance of
receives reduction annuity
0 0 0.00 0.00 12000.00
1 2035.00 60.00 1975.00 10025.00
2 2035.00 50.13 1984.88 8040.13

0.5% of Now the balance

12000 = $60 would be:
Minus the $60 from
the usual payment of
12000-1975 =
$2035
$10025
2035 – 60 = $1975
Annuity finance solver:
PV: You have annuity (investment) money to repay the bank = negative
PMT: Bank pays you for having the investment = positive
FV: Future/final values you get at the end = positive OR zero
EXAMPLE: Joe has an annuity of $200,000 at 5% compounding monthly
How much does get if paid for 10 years?
a. Joe will receive $2123.32 each month from the annuity

Chapter 9F/ Perpetuities

- A special annuity (investment) where the regular payment is same as the interest
earned
Payment received = interest earned
D= r/100 x Vo

EXAMPLE: Elizabeth puts superannuation of $500,000 as perpetuity at 6% interest to earn a

monthly income
What monthly payment will she receive?
a. V=500,000, r= 6/12 = 0.5%
D= r/100 x Vo
D= 0.5/100 x 500000
D= $2500 payment each month

EXAMPLE: A university has $30,000 to invest. It intend to award an annual prize of $1500
with the interest earned from investing the money as a perpetuity. What is the minimum
interest rate that will allow this prize to be awarded indefinitely?
a.

Click on this to get the % answer

Chapter 9G/ Compound Interest Investments with Regular Addition to the Principal (Annuity
Investments)
- Additional payments made by you to your existing investment to increase the rate of
growth of your investments

Modelling Compound Interest Investments with regular additions to the principle:

A recurrence relation that can be used to model the value of a compound interest
investment, Vn, after n additional payments have been made is:
Vo= The principal, Vn+1= Rvn + D
Where R= 1+r/100

EXAMPLE: Nor saves $1200 for overseas travels, planning to save an additional $50 into
savings, paying 3% interest compounding monthly
a. Write a recurrence relation for Nor’s additional payments
Vn= 1200
R= 3/12= 0.25% or 0.0025 R= 1.0025
D= 50

Vo=1200
Vn+1 = 1.0025Vn + 50

b. Nor’s investment after 1 year would be……..

1466.3283166427 x 1.0025 + 50 = 1519.99
1519.9941374343 x 1.0025 + 50 = 1573.79
1573.7941227779 x 1.0025 + 50 = 1627.73
1627.7286080848 x 1.0025 + 50 = 1681.8
1681.797929605 x 1.0025 + 50 = 1736
1736.002424429 x 1.0025 + 50 = 1790.34
1790.3424304901 x 1.0025 + 50 = 1844
= After 1 year the value of the investment is $1844.82

Amortisation tables for compound interest investments with addition to the Principal
Payment Payment made Interest earned Principal Balance of
number increase investment
0 0.00 0.00 0.00 1200.00
1 50.00 3.00 53.00 1253.00
2 50.00 3.13 53.13 1306.13

Additions to Principal using Finance Solver

EXAMPLE: Lara invests $500,000 at %5 per annum compounding monthly. He makes regular
payments of $500 per month.
a. His investment after 5 years is worth….
$675,682.38

Chapter 11A/ What is a Matrix?

- Numbers from a table enclosed inside square brackets
Name Height Weight Age
173 57 18 173 57 18
Rahdi 179 58 19
Dave 179 58 19

Order of a Matrix:
Number of rows x number of columns

173 57 18
D= -> number of rows x number of columns -> 2 x 3 = 6 elements
179 58 19

R= 173 57 18 -> row matrix/row vector -> 1 x 1 = 1 element

173
H= -> column/column vector -> 1 x 1 = 1 element
179

Transposition of a Matrix: Switch rows and columns

1 2
becomes 1 3 5
EXAMPLE: 3 4
2 4 6
5 6

Square Matrix: Has same number of rows and columns

1 5 1
2 2 4
2 −1 6

Diagonal Matrix: Square matrix which has all elements as 0, except in a diagonal direction
2 0 0
0 1 0
0 0 3

Identity Matrix:
- Leading diagonally with same number eg. 1
- Name of identity matrix is I
I= 1 0
0 1
Symmetric Matrix: has a leading diagonal line as a mirror image of elements below and
diagonal to the elements
2 3
3 1

Triangular Matrix: two types:

1 2 3 1 0 0 0
3 2 0 0
1. 0 4 5 2.
Upper triangle 6 5 4 0 Lower triangular
0 0 6
Identifying elements
matrix, of the matrix:
0 values at 0 9 8 7
column matrix, 0 values at
1 2 the bottom the top
A= Write down value of a21 2x1 =3
3 4
row

Entering a Matrix using CAS:

2 3 0
Enter the matrix =
1 4 2
- Main
- Keyboard
- Tap 2x2 matrix
- Then 1x2 matrix to add a 3rd column
- Matric will then be 2x3
2 3 0
- Should look like
1 4 2
- To name the matrix go to right hand side, tap key, then VAR & CAPS, press EXE

To transpose:
- Type A
- Highlight
- Select ‘Interactive’
- Matrix create?
- Tap TRN
11B/ Using Matrices to Present Information
EXAMPLE: Construct a matrix to display information in the table
Gym Memberships
Gender Weights Aerobics Fitness
 16 104 86
Males 16 104 86 75 34 94
Females 75 34 94

Represent the diagram given below as a 4x4 matrix:

If points are joined by a line = 1
If points aren’t joined by a line = 0
1 1 2 3 4
1 0 1 0 1
3 2 1 0 1 1
3 0 1 0 0
4 4 1 1 0 0

2
Chapter 11C/ Matrix Addition, Subtraction, and Scalar Multiplications
Equal Matrices: Should have the same elements and positions (locations)
1 2 1 2
is equal to
3 4 3 4

BUT

1 2 4 3
IS NOT EQUAL TO
3 4 2 1

EXAMPLE: Matrices with the same order can have their corresponding elements added or
subtracted
1 2 4 3
A= and B=
3 4 5 1

a. Find A+B
1 2 4 3 1+ 4 2+3 5 5
+ = =
3 4 5 1 3+ 5 4+1 8 5

b. A-B
1 2 4 3 1−4 2−3 −3 −1
- = =
3 4 5 1 3−5 4−1 −2 3

Multiplying Matrices by a Number (Scalar Multiplication):

1 2
eg. If A= , Find 3A
3 4
Scalar decreased or increases values of the elements on the matrix, in this case by 3
(3x everything inside the matrix)
1 2 3 6
3x =
3 4 9 12

Zero Matrix: matrix in any order, with all elements as 0

0= 0
0 0
0=
0 0

Using CAS:
2 3 0 1 0 3
If A= and B=
1 4 2 2 −2 1
Steps:
- Main
- Keyboard
- Enter matrices
- Type A matrix + B matrix
- Press EXE
- Do the same process for multiplication and subtraction

Chapter 11D/ Matrix Arithmetic – Product of Two Matrices

Multiplying two matrices – RULES:
1. Matric answer is defined IF number of columns in first matrix equals number of rows
in the second matrix
a. 2 x 3 3 x 1
Number of rows
Number of columns
2nd matrix
1st matrix

2. Order of matrix answer: Same row number of first matrix and same column number
of second matrix
a. 2 x 3 3 x 1 Order of answer matrix = 2 x 1

Multiplying by hand (no cas)

c= [ 10 32] [ 12 03] x [ 23] [ 12 xx 22 +

+
0x3
3x3 ] [ 132 ]
=

d= [ ]
2
3

Displaying Simultaneous equations in matrix form:

EXAMPLE: Show matrix equation generating simultaneous equations

[ ][ ] [ ]
4 2 x
3 2 y
=
5
2

Multiplying two matrices:

[ 43 22] [ xy ] = [ 52]
¿
[ 43 xx xx 22 xx yy ] = [ 52]
=5
¿
[ 43 xx 22 yy ] =2
Chapter 11E/ Matrix Powers
Power rules
22 written as 2 x 2
A2 written as A x A

EXAMPLES: If A= [ 12 −10 ] and B= [−12 11] and C= [ 01 11]

Determine:
a. 2A + B2 – 2C
(on cas)

[ ]
1 0
2 −1
⟹A

[ ]
−1 1
2 1
⟹B

[ ]
0 1
1 1
⟹C

[
= 2A + B2 – 2C =
5 −2
2 −1 ]
b. AB2 – 3C

[
AB2 – 3C2 =
0 −3
3 −9 ]
Chapter 11F/ Binary and Permutation Matrices
A Binary Matrix is a matrix whose elements are either zeros or 1:

[ ]
[ 1 01 ] or
1 1
1 0

A Permutation matrix is a square binary matrix in which there is only a single 1 in each
row/column:

[ ] [ ]
0 1
1 0
or
1 0
0 1

EXAMPLE:
Chapter 11F Cont./ Constructing a Communication Matrix

1. Construct One-step communication (C)

One-step communication– one person can speak or connected to another directly

2. Construct Two-step communication (C2)

Two-step communication – one person can talk to another with the help of third person as a
middle person e.g.

Eva can only talk to Yumi with the help of Wong in the middle

3. Total of one-step and two-step communication is adding matrix of C to C 2 . ( T = C +

C2 )
Chapter 11F Cont./ Dominance
Remember, arrow from a letter means the person who defeats the letter to which the arrow is
pointed at e.g B defeats A

EXAMPLES: Show one-step (D), two-step (D2) and total (T) dominance

One-step dominance

Two-step dominance
 Total dominance
Since ‘B’ has the highest score of 9, this
person is the highest-rank player

Chapter 12A/ The Inverse Matrix

- Matrix A, inverse A-1
- Inverse property = A x A-1 = 1, A-1 x A = I

EXAMPLE:
Show Matrix A = [ 23 35] and inverse of B = [−35 −32 ]
AxB=[
3 5] [ 3 2 ] [ 0 1]
2 3 5 −3 1 0
x =

B x A= [ ] x[ ] =[
0 1]
5 −3 2 3 1 0
3 2 3 5
Since AB= I and BA= I, Matrices A and B are inverses of each other

Determinant:
- Used in getting inverses
- To get inverse by hand:
eg.[ ]
2 3
3 5
swap numbers of left diagonal and second diagonal on the right to negatives

1/determinant x [−35 −32 ]

If determinant is 0, there’s no inverse
Chapter 12B/ Applications of the Inverse Matrix: Simultaneous Linear Equations
Using Matrix A, values of x and y can be determined using c and the inverse are given
eg. AxX=C
but to get X
X = A-1 x C

EXAMPLE: Solve the following using matrix method

A= [ ]
4 2
3 2
X= []
x
y
C= []
5
2
 Chapter 12C-1/ Transition Matrices and Their Applications: Setting up a Transition Matrix
A rental company has two branches, in Bendigo (B) and Colac (C)
20%

80% 90%
B C

10%
B > C = 20%
Means that 20% of cars rented in Bendigo each week are returned to Colac

Rented in:
B C
[
B 0.80 0.10
Returned to: C
0.20 0.90 ]
 Chapter 12C-2/ Interpreting Transition Matrices
(REFER TO EXAMPLE IN 12C-1)
20%

80% 90%
B C

10%
B > C = 20%
Means that 20% of cars rented in Bendigo each week are returned to Colac

Rented in:
B C
[
B 0.80 0.10
Returned to: C
0.20 0.90 ]
1. If there are 50 cars rented in a week, how many cars will be returned to Bendigo next
week?
0.80 x 50 = 40 cars

2. How many cars will be returned to Colac next week?

0.20 x 50 = 10 cars
Chapter 12C-3/ Constructing a Matrix Recurrence Relation
(REFER TO EXAMPLE IN 12C-1)
Let’s say the rental car owner based 50 cars in Bendigo and 40 in Colac

Starting Point OR Initial Point Matrix:

1. Find the starting point
S0= C [ ]
B 50
40

2. Now get the number of cars after 1 week

S1= TS0
=[0.80 0.10
0.20 0.90 ][ ]
x
50
40
S1 = [ ]
44
46
 44 cars in Bendigo & 46 cars in Colac

3. Number of cars after 3 weeks

S2= TS1
= [ ][ ]
0.80 0.10
0.20 0.90
x
44
46
= [ ]
39.8
50.2

Sn = Ts  Sn = TnS
S1 = T1So
S2 = T2So
S3 = T3So

State when number of cars at Bendigo and Colac becomes stable to a fixed number of cars
Eg.
1 2 3 4
Week:
State matrix:
50 44 39.8
40 46 50.2 [ ] [ ][ ] [ ][ ] [ ]
…
30.2 30.1 30.1
59.8 59.9 59.9
 has reached steady state
30 cars in Bendigo
60 cars in Colac

Chapter 12C-4/ Transition matrix modelling using the rule, Sn+1=TSn+B

Cars at Bendigo and Colac:
50
40 [ ]
If two extra cars are added at each location, then find/determine the number of cars at
Bendigo and Colac after a. 1 week and b. 2 weeks

So= [ 5040 ], S n+1 =TSn+B,

T= [ 0.80
0.20
0.10
0.90
and B=]2
2 []
a. S1=TSn+B

[ 0.80 0.10
0.20 0.90
x
50
40 ] [ ] [][ ]
+ =
2 46
2 48
 There are 46 cars in Bendigo and 48 cars in Colac

b. S2=TSn+B

[ ] 43.6
54.4
 There are 43.6 cars in Bendigo and 54.4 cars in Colac after 2 weeks
Chapter 14A/ Graphs and networks
 Graph shows dots called VERTICES and the lines called EDGES. Each edge joins two
vertices

Each point with a name of a person is VERTEX

Each line joining names of two people is called and EDGE

DEGREE – number of edges joining a ‘vertex B’ is 2

 deg(C) = 4

 A LOOP is an edge that connects back to itself

 Main graph

Parts of Main graph

Example

Chapter 14B/ Adjacency matrix

 Adjacency matrix is a square matrix that uses information from network diagram or
a graph and show a zero if there are no edges beween two vertices and a non-zero
number if there are edges between a pair of vertices.

Example:
 A connects to B, C and E
And that is why below B, C and E
Corresponding to row A shows a ‘1’.

 Loops are counted as one edge.

Chapter 14C/ Exploring and travelling

Chapter 14D/ Weighted graphs and networks
Weighted graphs - graphs that have a number associated with each edge and they are called
networks.

EXAMPLE: Find the shortest path from Bartow to Kenton in the network shown above
options

B−S−M−O−K 7+ 8 + 5 + 11 = 31 km The shortest path from Bartow to Kenton is

B−S−M−K 7+ 8 + 13 = 28 km 27 km
B−S−O−K 7+ 9 + 11 = 27 km with route B−S−O−K.

Dijkstra’s algorithm - determining the shortest path through a graph

Chapter 14E/ Trees and minimum connector problems
Chapter 15A/ Flow Problems
 Weighted graphs or networks include extra numerical information about the
connections, such as distance, time or cost.
 A directed graph, or digraph, records directional information on networks using
arrows on the edges.
 Directed graphs to real-life situations is flow problems. Flow problems involve the
transfer or flow of material from one point, called the source, to another point called
the sink. Examples of this include water flowing through pipes, or traffic flowing
along roads.

Source flow through network sink

Cuts - This cut completely blocks the flow of water from the source (S) to the sink (A).

Cut – separates source from sink Not a cut – materials still flow from source to
sink
Chapter 15B/ Matching and Allocation Problems
Bipartite graphs

Directed bipartite graphs

Bipartite graphs have vertices that are divided into two separate groups. In matching
problems, one vertex from one group is matched or allocated to one, or more, vertices of
the
second group and we use a directed bipartite graph to represent this matching.
Chapter 15C/ Precedence Tables and Activity Networks
Chapter 15D/ Scheduling Problems
 The weight (duration) of dummy activities is always zero.

 Critical path - The critical path is the sequence of activities that cannot be delayed
without affecting the overall completion time of the project.
Chapter 15E/ Crashing
 Changing the conditions of an activity within a project, and recalculating the
minimum completion time for the project, is called crashing.