Business Mathematics

Download PDF


Mathematics is considered to be the study of numbers, shapes & patterns and when this discipline is applied in a business, it becomes Business Math. For a business, it is a vital subject that a student has to deal with. It acts as a tool that helps in solving and controlling various business problems. The basic objective to learn this subject is to adapt the knowledge of various mathematical tools and techniques and models which helps in dealing with real-life business situations. It is also referred to as "commercial mathematics". In this article, we will talk about this particular subject ie. Business Mathematics. What does it mean, what are the various topics included in this, the importance of learning mathematics for business along with its scope? 

What is Business Mathematics?

This is the discipline that consists of mathematical concepts related to the business and it is not only limited to cost, profit/loss, and interest. It is beyond these basic concepts and includes other mathematical concepts as well. The operations or financial activities are controlled by business mathematics such as control on the cash flows, payroll, revenue, financial analysis, risk analysis, etc. The mathematical formulas help in almost every field of business such as in wage or salary calculation, employee performance management, profit & loss analysis, etc. Mathematical models help in analysing the business problems and finding out the appropriate solutions so that those problems do not arise in the future. It also helps in evaluating the problems and taking appropriate decisions in this regard to simplifying the business processes.

[Image will be uploaded soon]

Topics covered in Business Math

The fundamental topics covered in business maths subject are mentioned below which can be covered from any business maths book:


  • Ratios and Proportions

  • Simple and Compound interest including the application of Annuity

  • Bill Discounting & Average Due Date

  • Mathematical reasoning ( basic application )


  • Set Theory &  application of Venn Diagram

  • Variation, Indices, Logarithms

  • Permutation and Combinations

  • Linear Simultaneous Equations

  • Quadratic Equations

  • Determinants and Matrices


  • Constant and variables, Functions, Limit & Continuity

  • Differentiability & Differentiation, Partial Differentiation

  • Derivatives 

  • Maxima & Minima

  • Indefinite Integrals

  • Definite Integrals


  • Statistical Representation of Data

  • Measures of Central Tendency and Dispersion

  • Correlation and Regression

  • Index Numbers

  • Time Series Analysis

  • Probability

  • Theoretical Distribution

Importance of Commercial Mathematics

Business is all about management. Management of each and every aspect related to the business helps it to grow and in this management commercial mathematics plays a huge role.

  • Business math plays a vital role in creating the base of the business. In a business, it is very important to analyse the costs associated with the production of goods and services such as cost of raw materials, plant & machinery, rent, wages, marketing, administrative expenses, warehousing, interest as well as repayment of loans, etc. Only after analysing all the costs, estimation of profits can be done and in this whole process, commercial maths plays a prominent role.  

  • This particular subject helps in pricing the products and services after analysing all the costs and then in calculating the gross or net profit. This helps in analysing if the business is enough to run all the operations and if they are getting profits from the business or not.

  • This discipline helps in maintaining the good health of the company. It helps in calculating all the business taxes which is also a vital part of the company. Mathematics helps in maintaining this and helps in calculating the actual business profit after deduction of all the taxes & other deductions.

  • Business Math helps in assessing the financial performance of the business. It helps in estimating the incomes & expenditures along with the risk analysis. It also helps in the assessment of the rivals and their key areas along with their business strategies.

  • This very discipline helps in taking and improving decision making about different aspects of business such as costs, raw materials, marketing, advertising, strategies for the short and long term, etc. It helps in analyzing unforeseen situations and taking decisions in favour of the company.


Commercial Maths is one of the important disciplines for the commerce stream. It is being taught to the students from school level to college level in different mathematical finance course or business maths courses or any other courses related to the commerce field. A person needs other skills as well along with knowledge of mathematics such as economics, business studies, accountancy along with good communication skills. The persons knowing this subject can found their career in the following fields:

  • Securities analyst

  • Equity analyst

  • Expenditure analysts

  • Budget Analyst

  • Market Research Analyst

  • Policy underwriters

  • Risk analyst

  • Financial analysts

  • Investment analysts

  • Actuaries

  • Professor


To wrap up the discussion of Business math, we have learned about its meaning, topics, importance as well as scope of this subject. Basically, it includes all the mathematical concepts that can be applied to business and management so that it can run successfully. The basic purpose of Mathematics for economics and business is to analyse the business problems and find out the solutions of those problems and control the issues in such a way that it does not occur again in the future and if occurs damages should be minimum. It helps in almost every part of the business such as income & expenditure, sales and purchases, profit & loss, risk management, financial management, payroll management, etc. Besides this, this subject offers various career fields as well.

FAQs (Frequently Asked Questions)

1. What Are The Topics In Business Mathematics?

Answer. Various topics are being covered in this subject which includes ratio & proportion, profit & loss, interest, determinants, matrices, averages, probability, set theory, reasoning, correlation, regression, measures of Central Tendency, dispersion, time analysis, index numbers, etc. 

2. How is Business Mathematics Useful in Decision Making?

Answer. After analysing the current and past structure as well as the performance of the company, it helps in analysing the various parts of the business. For example, going through the income and expenditure accounts helps in taking decisions regarding the business operations so that income can be increased and expenditures can be reduced. It helps in taking decisions regarding marketing & advertising or during any problem after doing the market research. 

3. What is The Difference Between Maths and Business Maths?

Answer. Mathematics is an important discipline which deals with numbers, patterns and various shapes whereas business mathematics is a commercial subject that is applied to business. The former is considered as the wider subject because it includes everything such as arithmetic, algebra, topology, geometry, etc. whereas the latter is a subpart of mathematics that only deals with the concepts beneficial for the business purpose.

4. How Mathematical Models are Used in Business?

Answer. Mathematical models help in representing the real-life situations and problems of the business in an easy manner. Probability helps in analysing any risk and possibilities of any event whereas regression involves the study of independent as well as dependent variables. It helps in making decisions such as investment decisions and making predictions regarding the market as well as the performance of the business. It helps in simplifying the business processes.

Share this with your friends