# Questions tagged [optimization]

Mathematical techniques for the selection of a best element (with respect to some criteria) from the set of available alternatives.

9 questions
Filter by
Sorted by
Tagged with
When trying maximize the utility having a cobb-douglas utility function $u=x_1^ax_2^b$, with $a+b = 1$, I found the following formulas (Wikipedia: Marshallian Demand): $x_1 = \frac{am}{p_1}\\ x_2 = \... 0answers 99 views ### Revenue maximization problem There are$N>0Households in an economy. The government has aim to maximize a weighted average of income by imposing tax on the rich people and redistribute the tax revenue to the labor ones. ... 1answer 789 views ### Dynamic Optimization: What if the second order condition does not hold? Consider the following dynamic optimization problem \begin{align} &\max_u \int^T_0{F(x,u)dt}\\ \text{s.t.}~& \dot{x} = f(x,u) \end{align} FOCs The Hamiltonian is given by \begin{align} H(x,u,... 1answer 841 views ### Portfolio choice problem of a CARA investor with n risky assets Ok, I am working on a problem that consists of the following: I am looking to solve the portfolio choice optimization problem (maximizing utility with a known utility function) in the case where all ... 0answers 263 views ### Calculating the optimal portfolio for an investor with quadratic utility The problem is from Asset Pricing and Portfolio Theory by Back and can be found here. The relevant info from section 2.5 can be found here. Given that we have the Expected value and the variance of ... 1answer 470 views ### Question about budget constraint and utility maximization [closed] I have also following budget set $$B=\{x=(x_1,x_2)\in R^2_+ \mid 2\sqrt{x_1}+x_2\le y\}$$ where y is income. Assume that there are two stories. The agent can shop in both of them. The first store ... 2answers 2k views ### Transformation Function In Mas-Colell microeconomics textbook I have found that profit maximization problem (as well as many further optimization tasks) could be represented with application of some transformation function (... 2answers 186 views ### Dynamic programming, optimal consumption-savings (finite horizon) problem Letw_t$denote a consumer's wealth at time$t$and$c_t$, the amount she chooses to consume, so her savings exiting this time period are$w_t-c_t$. Given this savings decision, her savings$w_{t+1}\$ ...
I have question on central bank loss function. We know that the central bank loss function is $$L(\pi, \bar{Y})= (\pi- \pi^e)^2+\beta \bar {Y}^2$$ And we know that fisher equation is $$i=r+\pi^e$$...