A nonlinear function in math creates a graph that is not a straight line, according to Columbia University. Three nonlinear functions commonly used in business applications include exponential functions, parabolic functions and demand functions. Quadratic functions are common nonlinear equations that form parabolas on a two-dimensional graph.
Parabolic functions in business measure a company's marginal output by comparing units per employee. The top of the parabola is the point of maximum output per employee. Parabolic functions are formed by one of the terms squared. When variables change, the parabolic shape gets wider, thinner, taller or shorter.
A demand function shows the relationship between demand versus price of products. When demand increases, the graph goes up. When demand decreases, the graph goes down. When prices change, the demand graph changes along with the variable.
An exponential function usually shows an investment with compounded interest. The plot of a graph for this nonlinear function predicts how much a financial investment is worth in the future.
Quadratic equations form u-shaped parabolas that move up, down, and get wider or thinner based upon different functions of addition, subtraction, multiplication or division. The simplest quadratic function is "y=x^2" (y equals x squared).
The way to draw a nonlinear function on a graph is to plot points in various places and then connect the dots. Graphing programs on computers and calculators can easily create visualizations of nonlinear functions.