Learning objectives
- Distinguish constrained and unconstrained optimization
- Understand and use the method of Lagrange multipliers for constrained optimization
Before class
- Read Hughes-Hallett section 15.3
- Ponder Hughes-Hallett problems: 15.3: 2, 18, 22, 27, 30, 34, 41.
In class
- Exercises
- Shadow prices and an interpretation of the Lagrangian function
- The envelope theorem and more details
Daniel Flath 