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5:basic Tools of Economic Analysis and Optimization Techniques

This document outlines a session on basic tools of economic analysis and optimization techniques. The session will cover derivatives of various functions, optimization techniques like maximizing total revenue and profit, and minimizing average cost. It will also cover constrained optimization techniques like Lagrangian multiplier methods to maximize output under constrained situations. The session is presented by Prof. Trupti Mishra and references the textbook Managerial Economics by D.N. Dwivedi.

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Mohamed Hassan
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126 views

5:basic Tools of Economic Analysis and Optimization Techniques

This document outlines a session on basic tools of economic analysis and optimization techniques. The session will cover derivatives of various functions, optimization techniques like maximizing total revenue and profit, and minimizing average cost. It will also cover constrained optimization techniques like Lagrangian multiplier methods to maximize output under constrained situations. The session is presented by Prof. Trupti Mishra and references the textbook Managerial Economics by D.N. Dwivedi.

Uploaded by

Mohamed Hassan
Copyright
© © All Rights Reserved
We take content rights seriously. If you suspect this is your content, claim it here.
Available Formats
Download as PDF, TXT or read online on Scribd
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5:Basic Tools of Economic Analysis

and Optimization Techniques


1

Session Outline

Basic Tools of Economic Analysis and Optimization Techniques


Derivatives of various functions
Optimization techniques
Constrained optimization

Prof. Trupti Mishra, School of Management, IIT Bombay

Source : Managerial Economics; D N Dwivedi, 7th Edition


Prof. Trupti Mishra, School of Management, IIT Bombay

Source : Managerial Economics; D N Dwivedi, 7th Edition


Prof. Trupti Mishra, School of Management, IIT Bombay

Source : Managerial Economics; D N Dwivedi, 7th Edition


Prof. Trupti Mishra, School of Management, IIT Bombay

Source : Managerial Economics; D N Dwivedi, 7th Edition


Prof. Trupti Mishra, School of Management, IIT Bombay

Session Summary

Optimization Technique involves technique of maximizing total


revenue, techniques of optimizing output &minimizing average
cost & maximization of profit function
Functional Relationship between Economic Variables states the
relationship between a quantity, a value or a rate that changes
according to the changes in their determinants
Prof. Trupti Mishra, School of Management, IIT Bombay

Session Summary
Slope is the rate of change in the dependent variable as a result
of changes in the independent variables.
The techniques used for maximizing output under constrained
situations is called constrained optimization
Constrained optimization uses substitution technique
Lagrangian multiplier method
Prof. Trupti Mishra, School of Management, IIT Bombay

and

Session References
Managerial Economics; D N Dwivedi, 7th Edition

Prof. Trupti Mishra, School of Management, IIT Bombay

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