constraint

(noun)

A condition that a solution to a problem must satisfy.

Related Terms

Examples of constraint in the following topics:

  • Objective, constraints and alternatives

    • The achievement of any objective is subject to a set of constraints.
    • The constraints and objectives can be structured in a variety of ways.
    • For instance, a firm may try to maximize market share (objective) subject to the constraint that they earn a 12% return on capital investment.
    • Alternatively, a firm might try to maximize the rate of return on capital subject to the constraint that they maintain a 20% market share.
    • An individual might try to maximize income subject to the constraint that they have 30 days of leisure time per year or they might try to maximize their leisure time subject to the constraint that they have at least $50,000 income per year.

  • Internal and External

    • The control process can be hindered by internal and external constraints that require contingency thinking.
    • All processes are susceptible to constraints; the theory of constraints (TOC) postulates that "the chain is only as strong as its weakest link."
    • With this in mind, we can summarize internal constraints as any one or any combination of the following:
    • These constraints can be organized into three categories:
    • Examine the external and internal control constraints that may limit efficiency in the control process

  • Optimization of consumption

    • An agent should consume goods at the point where the most preferred available indifference curve is tangent to their budget constraint.
    • A budget constraint represents all the combinations of goods and services that a consumer may purchase given current prices within his or her given income.
    • In an economy with only two products An individual consumer should choose to consume goods at the point where the most preferred available indifference curve is tangent to their budget constraint .
    • That is, the indifference curve tangent to the budget constraint represents the maximum utility obtained utilizing the entire budget of the consumer.
    • Output is optimized where the budget constraint, marked in blue, is tangent to indifference curve, marked in red.

  • Introducing the Budget Constraint

    • Budget constraints represent the plausible combinations of products and services a buyer can purchase with the available capital on hand.
    • The concept of budget constraints in the field of economics revolves around the idea that a given consumer is limited in consumption relative to the amount of capital they possess.
    • To expand upon this definition further, the business concept of opportunity cost via trade-offs is a central building block in understanding budget constraints.
    • Understanding these trade-offs underlines the true function of budget constraints in economics, which is identifying which consumer behaviors will maximize utility.
    • Through utilizing these economic tools, economists can predict consumer behavior and consumers can maximize their overall utility based upon their budget constraints.

  • Lagrange Multiplers

    • The method of Lagrange multipliers is a strategy for finding the local maxima and minima of a function subject to equality constraints.
    • In mathematical optimization, the method of Lagrange multipliers (named after Joseph Louis Lagrange) is a strategy for finding the local maxima and minima of a function subject to equality constraints.
    • Such difficulties often arise when one wishes to maximize or minimize a function subject to fixed outside conditions or constraints.
    • Therefore where the constraint $g=c$ crosses the contour line $f=-1$, is a local minimum of $f$ on the constraint.
    • Find x and y to maximize f(x,y) subject to a constraint (shown in red) g(x,y)=c.

  • Populations

    • Since in this case and many others it is impossible to observe the entire statistical population, due to time constraints, constraints of geographical accessibility, and constraints on the researcher's resources, a researcher would instead observe a statistical sample from the population in order to attempt to learn something about the population as a whole.

  • Work

    • Work performed by a closed system is the energy transferred to another system that is measured by mechanical constraints on the system.
    • In thermodynamics, work performed by a closed system is the energy transferred to another system that is measured by mechanical constraints on the system .

  • Structural holes

    • In our example constraint measures are not very large, as most actors have several ties.
    • Hierarchy (Hierarc) is another quite complex measure that describes the nature of the constraint on ego.
    • If the constraint results more equally from multiple actors in ego's neighborhood, hierarchy will be less.
    • The hierarchy measure, in itself, does not assess the degree of constraint.
    • But, among whatever constraint there is on ego, it measures the important property of dependency -- inequality in the distribution of constraints on ego across the alters in its neighborhood.

  • Gain Contingencies

    • The disclosure of gain contingencies is affected by the materiality concept and the conservatism constraint.
    • Most accounting principles follow the conservative constraint, which encourages the immediate disclosure of losses and expenses on the income statement.
    • This constraint also encourages the omission of revenues and gains until those gains are realized.

  • Introduction to Optimization and Markets

    • Most of Neoclassical economics presumes that the agent is trying to maximize or minimize (optimize) some objective with respect to a set of constraints.