Effects of Various Inputs for Increased Interest Rate of Capital: A Nonlinear Budget Constraint Consideration

Devajit Mohajan and Haradhan Kumar Mohajan
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Devajit Mohajan: Department of Civil Engineering, Chittagong University of Engineering & Technology, Chittagong, Bangladesh
Haradhan Kumar Mohajan: Department of Mathematics, Premier University, Chittagong, Bangladesh

Frontiers in Management Science, 2023, vol. 2, issue 4, 15-33

Abstract: This article attempts to discuss economic effects of various inputs when the interest rate of capital is increased during profit maximization analysis. In this paper Cobb-Douglas production function, 6×6 bordered Hessian matrix, and 6×6 Jacobian are operated to make the study meaningful and interesting. Every firm wants to achieve a maximum profit, but achievement of profit maximization is not an easy process. A firm must be watchdog in every step of production, inventory, distribution, and management for attaining optimum result. In the twenty first century global economy faces serious complexities due to political unrest and war among the nations, also for abnormal natural calamities due to global warming. Therefore, efficient and wise decisions are necessary for the sustainability of the industrial firms.

Keywords: profit maximization; nonlinear budget constraint; interest rate of capital (search for similar items in EconPapers)
Date: 2023
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Persistent link: https://EconPapers.repec.org/RePEc:bdz:frmans:v:2:y:2023:i:4:p:15-33

DOI: 10.56397/FMS.2023.08.02

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