Abstract
In this paper we consider the numerical approximation of the two-phase membrane (obstacle) problem by finite difference method. First, we introduce the notion of viscosity solution for the problem and construct certain discrete nonlinear approximation system. The existence and uniqueness of the solution of the discrete nonlinear system is proved. Based on that scheme, we propose projected Gauss-Seidel algorithm and prove its convergence. At the end of the paper we present some numerical simulations.
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