Question: Suppose the company in the above problem is constrained by the Environmental Protection Agency which has decided that the firm can produce only a

Suppose the company in the above problem is constrained by the Environmental Protection Agency which has decided that the firm can produce only a total of 34 units of x and y combined (i.e. x + y = 34). a. Set up the Lagrangean function and find the constrained optimal values of x and y. b. Check second order conditions by aZyy + bZxx - 2abZxy > 0 for a minimum and aZyy + bZxx - 2abZxy < 0 for a maximum where the constraint is written as ax + by = c. c. Find lambda and interpret. d. Comment in a nontrivial way on the relationshipt between problem 3 above and what lambda is telling you. e. Find the profit level.
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