TAOCP 4.7 Exercise 20
By definition, W(z)=U(V(z)),\qquad U(z)=\sum_{k\ge1}U_kz^k, since $U_0=0$.
Section 4.7: Manipulation of Power Series
Exercise 20. [**] [HM20] Continuing exercise 17, suppose we have $W(z) = U(V(z))$ and $U_0 = 0$. Prove that the power matrix of $W$ is the product of the power matrices of $V$ and $U$: $w_{nk} = \sum_j v_{nj} u_{jk}$.
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By definition,
$$ W(z)=U(V(z)),\qquad U(z)=\sum_{k\ge1}U_kz^k, $$
since $U_0=0$. Hence
$$ W(z)=\sum_{k\ge1}U_k,V(z)^k. $$
Using the definition of the power matrix,
$$ V(z)^k=k\sum_{j\ge0}v_{kj}z^j, \qquad W(z)^n=n\sum_{m\ge0}w_{nm}z^m. $$
For fixed $n$,
$$ W(z)^n=U(V(z))^n. $$
Since the power matrix of $U$ is defined by
$$ U(z)^n=n\sum_{k\ge0}u_{nk}z^k, $$
substituting $V(z)$ for $z$ gives
$$ W(z)^n =n\sum_{k\ge0}u_{nk}V(z)^k =n\sum_{k\ge0}u_{nk}\Bigl(k\sum_{m\ge0}v_{km}z^m\Bigr). $$
Therefore
$$ W(z)^n =n\sum_{m\ge0}\Bigl(\sum_{k\ge0}u_{nk}v_{km}\Bigr)z^m. $$
Comparing with
$$ W(z)^n=n\sum_{m\ge0}w_{nm}z^m, $$
yields
$$ w_{nm}=\sum_{k\ge0}u_{nk}v_{km}. $$
Renaming indices gives the stated matrix-product formula,
$$ \boxed{; w_{nk}=\sum_j v_{nj}u_{jk} ;} $$
which shows that the power matrix of $W=U!\circ V$ is the product of the power matrices of $V$ and $U$. ∎