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The Lagrangian Method of Optimization Results in a New Variable λ\lambda

Question 17

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The Lagrangian method of optimization results in a new variable, λ\lambda ,called the Lagrangian multiplier,which shows the additional to total utility from an additional unit of income.In other words, λ\lambda expresses the:


A) the budget constraint.
B) the cost of acquiring an additional util of satisfaction.
C) the marginal utility of income.
D) the optimal level of utility.

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