answer a question 18

In economic analysis, optimization or identification of the best or optimal solution of a function is an important concept with respect to economic decision making. The ability to identify extreme values, whether maximum, minimum, or an inflection point is therefore important in the evaluation of economic models. Extreme values are typically identified through the First Order Condition. For univariate functions, two types of values can behave like extreme values.

What are the two types of non-extreme values and how can each distort the ability to identify the true extreme value of a function? You may consult your textbook when answering this question.

Proper citations and reading references are required as part of your learning effectiveness.

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