Pregled bibliografske jedinice broj: 784656
A non-calculus approach to solving the utility maximization problem using the Cobb-Douglas and CES utility function
A non-calculus approach to solving the utility maximization problem using the Cobb-Douglas and CES utility function // Croatian operational research review, 6 (2015), 269-277 doi:10.17535/crorr.2015.0021 (međunarodna recenzija, članak, znanstveni)
CROSBI ID: 784656 Za ispravke kontaktirajte CROSBI podršku putem web obrasca
Naslov
A non-calculus approach to solving the utility maximization problem using the Cobb-Douglas and CES utility function
Autori
Kojić, Vedran
Izvornik
Croatian operational research review (1848-0225) 6
(2015);
269-277
Vrsta, podvrsta i kategorija rada
Radovi u časopisima, članak, znanstveni
Ključne riječi
constrained optimization ; Cobb-Douglas utility function ; CES utility function ; non-calculus approach ; mathematical inequalities
Sažetak
This paper proposes a new original non-calculus method to solving the utility maximization problem using the Cobb-Douglas and the CES utility functions, and incorporating the weighted arithmetic-geometric-mean inequality (weighted AM-GM inequality) and Jensen’s inequality. Instead of using calculus, the substitution method or the Lagrange multiplier method, the maximum utility and global maximizer for the case of the Cobb-Douglas and CES utility functions are derived in a direct way. The new method does not require checking first and second order conditions, which the substitution method and the Lagrange multiplier method normally require.
Izvorni jezik
Engleski
Znanstvena područja
Matematika, Ekonomija
