Output Maximization of an Agency
Considering Cobb-Douglas function in three variables as an explicit form of production function, in this paper an attempt has been made to maximize an output subject to a budget constraint, using Lagrange multipliers technique, as well as necessary and sufficient conditions for optimal value have been applied. We gave interpretation of Lagrange multiplier in this specific illustration, showing its positive value, and examined the behavior of the agency.
|Date of creation:||11 Mar 2008|
|Date of revision:||20 Jan 2009|
|Publication status:||Published in Indus Journal of Management & Social Sciences 1.3(2009): pp. 39-51|
|Contact details of provider:|| Postal: Ludwigstraße 33, D-80539 Munich, Germany|
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- Pahlaj Moolio & Jamal Nazrul Islam, 2008. "Cost Minimization of a Competitive Firm," Indus Journal of Management & Social Science (IJMSS), Department of Business Administration, vol. 2(2), pages 148-160, December.
- Pahlaj Moolio & Jamal Nazrul Islam & Haradhan Kumar Mohajan, 2009. "Output Maximization of an Agency," Indus Journal of Management & Social Science (IJMSS), Department of Business Administration, vol. 3(1), pages 39-51, June.