NEKG33 Mathematical methods for economists

Chapter 10 : Day 10: Lagrange

By Lund University

Final day of the first part of the course. We will look at the most "advanced" topic of the course, constrained optimization and the method of Lagrange.

Constrained optimization

In the final theory section of the first part of the course we look at constrained optimization. Specifically, we will introduce something called the Lagrangian and the Lagrange multiplier and we will study the method of Lagrange. This method will help us to find the optimal point that at the same time satisfy our constraint.

Constrained optimization

Constrained optimization: Problems

Exercises on constrained optimization

Problem: Constrained maximization

Problem: Constrained minimization

Problem: Constrained optimization

Problem: Optimizing utility under budget constraint

Problem: Optimizing utility under constraint

Problem: Optimizing profit under constraint

Problem: Find demand function

Problem: Optimizing utility under budget constraint

Problem: Constrained optimization

Problem: Constrained optimization

Problem: Constrained optimization and Lagrange multiplier