Logo
Munich Personal RePEc Archive

Cost Minimization is Essential for the Sustainable Development of an Industry: A Mathematical Economic Model Approach

Mohajan, Haradhan (2021): Cost Minimization is Essential for the Sustainable Development of an Industry: A Mathematical Economic Model Approach. Published in: Annals of Spiru Haret University Economic Series , Vol. 20, No. 1 (31 March 2021): pp. 37-69.

[thumbnail of MPRA_paper_106924.pdf]
Preview
PDF
MPRA_paper_106924.pdf

Download (722kB) | Preview

Abstract

The method of Lagrange multiplier is a very useful and powerful technique in multivariable calculus. In this study interpretation of Lagrange multiplier is given with satisfactory mathematical calculations and shows that its value is positive. For the sustainable development of an industry, cost minimization policy is crucial. In any industry the main objective is to minimize production cost for maximizing its profit. By considering Lagrange multiplier technique application an attempt has been taken here in cost minimization problem subject to production function as an output constraint. To predict future performance of an industry, mathematical calculations are necessary and all the procedures are given in this paper with detail mathematical procedures. In this study an attempt has been taken to minimize cost by considering three variables capital, labor, and other inputs of an industry by the application of economic models subject to a budget constraint, using Lagrange multiplier technique, as well as, using necessary and sufficient conditions for minimum value.

Atom RSS 1.0 RSS 2.0

Contact us: mpra@ub.uni-muenchen.de

This repository has been built using EPrints software.

MPRA is a RePEc service hosted by Logo of the University Library LMU Munich.