Elements of Numerical Mathematical Economics with Excel

9.14. Checking the Second-Order Conditions in Excel

We conclude this chapter briefly mentioning an important issue in CoV, that is the one of checking the Second-Order Conditions, to see whether the extremal found do actually maximizes or minimizes the functional J(y).

Computing our solution numerically we always let the Excel optimizer finding the correct solution. However, one may also check the Second-Order Conditions examining whether the integrand function F(t, y, yʹ) is globally convex or concave in Excel using the What-if Analysis Data Table.

 

Table 9.13-2

Example 2 isoperimetric problem excel output results.

This ...