How Are Line Integrals Used in Finance and Economics?

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SUMMARY

Line integrals have significant applications in finance and economics, particularly through their relationship with stochastic integrals. These mathematical tools allow for the calculation of areas bounded by closed curves, which can be applied to various economic models. The discussion highlights the utility of Green's Theorem in this context, emphasizing the relevance of line integrals beyond their traditional use in physics.

PREREQUISITES
  • Understanding of line integrals and their mathematical properties
  • Familiarity with stochastic integrals and their applications
  • Knowledge of Green's Theorem and its implications
  • Basic concepts in economics and financial modeling
NEXT STEPS
  • Research the application of stochastic integrals in financial modeling
  • Study Green's Theorem and its use in economic analysis
  • Explore advanced topics in calculus related to line integrals
  • Investigate case studies where line integrals are applied in economics
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Mathematicians, economists, financial analysts, and students interested in the intersection of mathematics and economic theory.

woundedtiger4
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other than the physics (work) what are the applications of line integral? particularly does it have any use in finance or economics?
 
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Stochastic integrals are quite close to line integrals. They are used, e.g., in economics.
 
by line integrals and green's thm, you can find the area of any shape bounded by a closed curve. It's pretty cool actually.
 
camillio said:
Stochastic integrals are quite close to line integrals. They are used, e.g., in economics.

thanks
 

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