Shuwen was inspired by an in-depth exploration of the course ECON201. During this course, the concept of “Lagrange Multipliers” stands out as an important topic. This mathematical principle, which is also a significant component of multivariable calculus, serves as a bridge linking Mathematics and Economics. The connections between these mathematical concepts and their applications in economics sparked the inspiration for our project. In essence, “Lagrange Multipliers” offers a framework for addressing complex optimization constraint challenges, particularly in the context of economic analysis. They have become an important tool for mathematicians and economists, allowing for the efficient resolution of problems involving constraints.
In our project, we formulated various mathematical scenarios grounded in economic principles. The example in our poster is a case focused on maximizing profit. Here, we had a known production function for constructing a Lagrange function. This function intricately incorporates both the constraints and the objectives of the case. By applying the method of “partial derivatives” which is commonly used in Mathematics, we were able to derive the equilibrium values of the variables in question. This approach exemplifies “Lagrange Multipliers,” demonstrating their application not only in profit maximization but also in other economic scenarios such as cost minimization and utility maximization.
