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

Devajit Mohajan and Haradhan Mohajan
Authors registered in the RePEc Author Service: Dr Haradhan Kumar Mohajan ()

MPRA Paper from University Library of Munich, Germany

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)
JEL-codes: C3 C51 C53 C61 C67 C68 I3 I31 J3 (search for similar items in EconPapers)
Date: 2023-05-05, Revised 2023-05-06
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Published in Frontiers in Management Science 4.2(2023): pp. 15-33

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