Munich Personal RePEc Archive

Utility Maximization Subject to Multiple Constraints

Islam, Jamal and Mohajan, Haradhan and Moolio, Pahlaj (2010): Utility Maximization Subject to Multiple Constraints. Published in: Indus Journal of Management & Social Sciences , Vol. 4, No. 1 (30. June 2010): pp. 15-29.

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Abstract

Using method of Lagrange multipliers, an attempt has been taken in this paper to derive mathematical formulation to devise optimal purchasing policy in order to maximize utility function subject to multiple constrained, in this particular illustration, two constraints: 1) budget constraint, and 2) coupon constraint. An explicit example is provided in order to examine the behaviour of an individual consumer and to support the analytical arguments.

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