6.4.

THE CONCEPT OF LIMIT 89

Example 6.4.2 Consider

q = (1 − v 2 )/(1 − v).

For this function, N = 1 is not in the domain of the function, and we

cannot set v = 1 since it would involve division by zero. Moreover, even
the limit-evaluation procedure of letting v − 1 will cause difficulty since
(1 − v) → 0 as v → 1.
One way out of this difficulty is to try to transform the given ratio to a
form in which v will not appear in the denominator. Since

1 − v2 (1 − v)(1 + v)
q= = = 1 + v (v ̸= 1)
1−v 1−v

and v → 1 implies v ̸= 1 and (1 + v) → 2 as v → 1, we have limv→1 q = 2.

2v+5
Example 6.4.3 Find limv→∞ v+1
.
2v+5 2(v+1)+3 3 3 2v+5
Since v+1
= v+1
= 2 + v+1 and limv→∞ v+1
= 0, so limv→∞ v+1
= 2.

Formal View of the Limit Concept

Definition 6.4.1 The number L is said to be the limit of q = g(v) as v

approaches N if, for every neighborhood of L, there can be found a corre-
sponding neighborhood of N (excluding the point v = N ) in the domain
of the function such that, for every value of v in that neighborhood, its im-
age lies in the chosen L-neighborhood. Here a neighborhood of a point L
is an open interval defined by

(L − a1 , L + a2 ) = {q|L − a1 < q < L + a2 } for a1 > a2 > 0

90CHAPTER 6. COMPARATIVE STATICS AND THE CONCEPT OF DERIVATIVE

Figure 6.3: The graphical representation of the limit defined in term of

neighborhoods.

6.5 Inequality and Absolute Values

Rules of Inequalities:

Transitivity:
a > b and b > c implies a > c;
a ≥ b and b ≥ c implies a ≥ c.
Addition and Subtraction:
a > b =⇒ a ± k > b ± k;
a ≥ b =⇒ a ± k ≥ b ± k.
Multiplication and Division:
a > b =⇒ ka > kb (k > 0);
a > b =⇒ ka < kb (k < 0).
6.5. INEQUALITY AND ABSOLUTE VALUES 91

Squaring:
a > b with b ≥ 0 =⇒ a2 > b2 .

Absolute Values and Inequalities

For any real number n, the absolute value of n is defined and denoted
by 

 n if n > 0,



|n| = −n if n < 0,




 0 if n = 0.

Thus we can write |x| < n as an equivalent way −n < x < n (n > 0).
Also |x| ≤ n if and only if −n ≤ x ≤ n (n > 0).
The following properties characterize absolute values:
1) |m| + |n| ≥ |m + n|;
2) |m| · |n| = |m · n|;
|m| m
3) |n|
= n
.

Solution of an Inequality

Example 6.5.1 Find the solution of the inequality 3x−3 > x+1. By adding
(3 − x) to both sides, we have

3x − 3 + 3 − x > x + 1 + 3 − x.

Thus, 2x > 4 so x > 2.

Example 6.5.2 Solve the inequality |1 − x| ≤ 3.

From |1 − x| ≤ 3, we have −3 ≤ 1 − x ≤ 3, or −4 ≤ −x ≤ 2. Thus,
4 ≥ x ≥ −2, i.e., −2 ≤ x ≤ 4.
92CHAPTER 6. COMPARATIVE STATICS AND THE CONCEPT OF DERIVATIVE

6.6 Limit Theorems

Theorems Involving a Single Equation

Theorem I: If q = av + b, then limv→N q = aN + b.

Theorem II: If q = g(v) = b, then limv→N q = b.

Theorem III: limv→N v k = N k .

Example 6.6.1 Given q = 5v + 7, then limv→2 = 5 · 2 + 7 = 17.

Example 6.6.2 q = v 3 . Find limv→2 q.

By theorem III, we have limv→2 = 23 = 8.

Theorems Involving Two Functions

For two functions q1 = g(v) and q2 = h(v), if limv→N q1 = L1 , limv→N q2 =

L2 , then we have the following theorems:

Theorem IV: limv→N (q1 + q2 ) = L1 + L2 .

Theorem V: limv→N (q1 q2 ) = L1 L2 .

Theorem VI: limv→N q1

q2
= L1
L2
(L2 ̸= 0).

1+v
Example 6.6.3 Find limv→0 2+v
.
1+v
Since limv→0 (1 + v) = 1 and limv→0 (2 + v) = 2, so limv→0 2+v
= 12 .

Remark 6.6.1 Note that L1 and L2 represent finite numbers; otherwise the-
orems do not apply.

Limit of a Polynomial Function

lim a0 + a1 v + a2 v 2 + · · · + an v n = a0 + a1 N + a2 N 2 + · · · + an N n .
v→N
6.7. CONTINUITY AND DIFFERENTIABILITY OF A FUNCTION 93

6.7 Continuity and Differentiability of a Func-

tion
Continuity of a Function

Definition 6.7.1 A function q = g(v) is said to be continuous at N if limv→N q

exists and limv→N g(v) = g(N ).

Thus the term continuous involves no less than three requirements: (1)
the point N must be in the domain of the function; (2) limv→N g(v) exists;
and (3) limv→N g(v) = g(N ).

Remark 6.7.1 It is important to note that while – in discussing the limit

of a function – the point (N, L) is excluded from consideration, we are no
longer excluding it in defining continuity at point N . Rather, as the third
requirement specifically states, the point (N, L) must be on the graph of
the function before the function can be considered as continuous at point
N.

Polynomial and Rational Functions

From the discussion of the limit of polynomial function, we know that

the limit exists and equals the value of the function at N . Since N is a
point in the domain of the function, we can conclude that any polynomial
function is continuous in its domain. By those theorems involving two
functions, we also know any rational function is continuous in its domain.

4v 2
Example 6.7.1 q = v 2 +1
.
Then
4v 2 limv→N 4v 2 4N 2
lim = = .
v→N v2 + 1 limv→N (v 2 + 1) N2 + 1
94CHAPTER 6. COMPARATIVE STATICS AND THE CONCEPT OF DERIVATIVE

Example 6.7.2 The rational function

v 3 + v 2 − 4v − 4
q=
v2 − 4

is not defined at v = 2 and v = −2. Since v = 2, −2 are not in the domain,

the function is discontinuous at v = 2 and v = −2, despite the fact that its
limit exists as v → 2 or −2 by noting

v 3 + v 2 − 4v − 4 v(v 2 − 4) + v 2 − 4
q = =
v2 − 4 v2 − 4
(v + 1)(v − 4)
2
= = v + 1 (v ̸= 2, −2).
v2 − 4

Differentiability of a Function

By the definition of the derivative of a function y = f (x), we know that

f ′ (x0 ) exists at x0 if and only if the lim of ∆y/∆x exists at x = x0 as ∆x → 0,
i.e.,

∆y
f ′ (x0 ) = lim
∆x→0 ∆x
f (x0 + ∆x) − f (x0 )
≡ lim (differentiability condition).
∆x→0 ∆x

On the other hand, the function y = f (x) is continuous at x0 if and only

if
lim f (x) = f (x0 ) (continuity condition).
x→x0

We want to know what is the relationship between the continuity and

differentiability of a function. Now we show the continuity of f is a neces-
sary condition for its differentiability. But this is not sufficient.

Since the notation x → x0 implies x ̸= x0 , so x−x0 is a nonzero number,