ECON 5100 Assignment 6 Solution

HKUST
October 27, 2022

Problem 1. Let S := [−1, 1] × [−1, 1] ⊂ R2 . Does the mapping f : S → S such that f (x, y) = (x/2, y/3)
have a fixed point? Which fixed point theorem, Banach, Brouwer, or both, applies here? If Banach applies,
also find the fixed point.

Solution. f has a fixed point.

Both Banach and Brouwer theorem applies for f :
(1) Banach:
S is complete and f is contraction. S is complete because it is a closed subset of complete metric space R2 .
r s
1 2 1 2 1 2 1 2
d (f (x1 , y1 ) − f (x2 , y2 )) = 2
(x1 − x2 ) + 2 (y1 − y2 ) ≤ 2
(x1 − x2 ) + 2 (y1 − y2 ) =
2 3 2 2

1
d(x, y)∀ (x1 , y1 ) , (x2 , y2 ) ∈ S
2
(2) Brouwer:
S is compact and convex and f is continuous.
S is compact because it is closed and bounded in Euclidean space. And it’s clear that S is covex as every
line connecting any two points in it is inside S.
Since fx (x, y) = 1/2 and fy (x, y) = 1/3, f (x, y) is continuous.
(0, 0) is the fixed point. From Banach we konw that (x, f (x), f (f (x)), · · · ) → x∗ . For any (x, y) ∈
S, ((x, y), (x/2, y/3), (x/4, y/9), · · · ) → (0, 0)

Problem 2. Consider the function f : R3 → R where f (x, y, z) = x2 (y + z). 1. Find ∇f (x, y,z). 2.  Find
1
Hf (x, y, z). 3. Is f totally differentiable? If so, find f 0 (x, y, z). 4. Find ∇v f (1, 1, 1) where v =  2 .
3
2 2


Solution. (1) ∇f (x,
 y, z) = (f x , fy , fz )
  = 2x(y + z), x , x . 
fxx fxy fxz 2(y + z) 2x 2x
(2) Hf (x, y, z) =  fyx fyy fyz  =  2x 0 0 
fzx fzy fzz 2x 0 0
(3) Yes.
Because ∇f exists at ∀x ∈ R3 and fx , fy , fz are continuous at ∀x ∈ R3 , by Proposition 5.5 (2), f is (totally)
differentiable.
f 0 (x, y, z) = ∇f (x, y, z) = (fx , fy , fz ) = 2x(y + z), x2 , x2 .


√
[∇f (1,1,1)]t v (4,1,1)(1,2,3)t 9 14
(4) ∇v f (1, 1, 1) = kvk = √
1+4+9
= 14 .

Problem 3. Consider the function f : R2 → R where f (x, y) = x2 + y 2 . Find the slope of the line tangent
to any point (x, y) on the contour curve f (x, y) = k.

Solution. g 0 (x) = − ffxy (x,y)

(x,y)
= − 2x x
2y = − y where y = g(x)
When y = 0, the slope is ±∞

1
Problem 4. Suppose that f : Rn → R is differentiable. Prove that

∇∇f (x) f (x) ≥ ∇v f (x) ∀v ∈ Rn

v v
Solution. Recall that ∇v f (x) = ∇f (x) · kvk = k∇f (x)kk kvk k cos θ = k∇f (x)k cos θ for any v ∈ Rn where θ
is the angle between ∇v f (x) and v. Since cos θ achieves its highest value when θ = 0, it follows that ∇v f (x)
achieves its highest value when v is co-directional to ∇f (x), including when v is equal to ∇f (x).

Problem 5. Find all global maximizers of f (x) = sin x.

Solution. f 0 (x) = cos x. Let f 0 (x) = 0, critical points are x = π2 + nπ∀n ∈ N. f 00 (x) = − sin x. Since f 00 < 0
when x = π2 + 2nπ and f 00 < 0 when x = − π2 + 2nπ, f (x) takes its local maximum when x = π2 + 2nπ. And
f (x) takes its global maximum when x = π2 + 2nπ because all local maximums are equal to 1 .

Problem 6. Suppose f : R → R is twice-differentiable and strictly concave.

1. Prove that f 00 (x) < 0∀x.
2. Use the first and second order conditions to prove that f has at most one global maximizer. Is it possible
that f has no global maximizer?

Solution. (1) ∀h > 0, f 0 (x + h) = limh→0 f (x+2h)−f h

(x+h)
, f 0 (x) = limh→0 f (x+h)−f
h
(x)
.
0 0 f (x+2h)+f (x)−2f (x+h)
Thus, f (x + h) − f (x) = limh→0 h .
Because f is strictly concave, ∀λ ∈ [0, 1], f (λx1 + (1 − λ)x2 ) > λf (x1 ) + (1 − λ)f (x2 ).
Let x1 = x + 2h, x2 = x, λ = 21 , then f ((x + 2h)/2 + x/2) = f (x + h) > 12 (f (x + 2h)+ f (x)), that is,
f (x + 2h) + f (x) − 2f (x + h) < 0.
Thus, f 0 (x + h) − f 0 (x) < 0.f 0 (x) is strictly decreasing.
0 0
Because f 00 (x) = limh→0 f (x+h)−f h
(x)
, then f 00 (x) < 0.
(2) f (x) is strictly monotonely decreasing. Hence, there is at most one solution for f 0 (x) = 0. It is possible
0

to have no global maximizer. For example, f (x) = log(x)

Problem 7. Solve the optimization problem

√
max x1 x2
s.t. 2
x1 + x22 = 1

Solution.
√
x1 x2 − µ x21 + x22 − 1 .


L (x1 , x2 , µ) =
√ √ √ 
x x
Denote f (x1 , x2 ) = x1 x2 and h (x1 , x2 ) = x21 +x22 ·f 0 = 2√x21 , 2√x12 , f is not differentiable when x1 x2 = 0
and h0 = (0, 0) when x1 = x2 = 0.A = {(x1 , x2 ) : x1 x2 = 0}. Since f = 0 when x1 x2 = 0 and f > 0 otherwise.
Elements in A are not maximizers.
Let L0 = 0 : √
x2
√ − 2µx1 = 0
2 x1
√ 
x1
√ − 2µx2 = 0
2 x2
x21 + x22 − 1 = 0
 √ √ √ √ √
Then B = (1/ 2, 1/ 2), (−1/ 2, −1/ 2} and f = 1/ 2 when (x1 , x2 ) ∈ B.B is the solution to the
optimization problem.

Problem 8. Solve the optmization problem

max −x2
s.t. x21 − x32 = 0

2
 2/3
Solution. x2 = x1 ≥ 0, so −x2 ≤ 0. The maximum is 0 and (x1 , x2 ) = (0, 0)
Note that the Lagrangian method doesn’t work here, because the derivative of the constraint function
x21 − x32 at the maximizer (0, 0) is equal to (0, 0), implying that the necessary conditions from the Lagragian
method need to hold here.

Problem 9. Solve the optimization problem

max x1 + x2
s.t. x21 + x22 ≤ 1

Solution.
L (x1 , x2 , λ) = x1 + x2 − λ x21 + x22 − 1

KKT condition:
∂L 1
= 1 − 2λx1 = 0 ⇒ x1 =
∂x1 2λ
∂L 1
= 1 − 2λx2 = 0 ⇒ x2 =
∂x2 2λ
λ x21 + x22 − 1 = 0

λ≥0
x21 + x22 ≤ 1
√ √
1 1 2 2


Plug x1 = 2λ , x2 = 2λ in λ x21 + x22 − 1 = 0, we have λ1 = 0, λ2 = 2 . Because x21 + x22 ≤ 1, then λ = 2 .
√ √
Thus, x1 = x2 = 22 and max x1 + x2 = 2.