Mathematics for Economics: Tutorial 7 - Problem 31

In this tutorial, we solve a constrained optimisation problem using the Lagrangian and Karush–Kuhn–Tucker (KKT) conditions, carefully deriving the first-order conditions. We then construct the bordered Hessian and apply the principal minors method to classify the solution, determining whether the point is a maximum, minimum, or saddle point. Throughout, the focus is on clear intuition, clean algebra, and systematic reasoning, making this a practical guide to second-order conditions for constrained optimisation. ☕️ Buy Me a Coffee: buymeacoffee.com/Kosaksi_Pasa