See Also: Optimization(finance)
optimization(encyclopedia)
Optimization approach to indexing(money)
Optimization approach to indexing(finance)

optimization (sh)




Field of applied mathematics whose principles and methods are used to solve quantitative problems in disciplines including physics, biology, engineering, and economics.

Questions of maximizing or minimizing functions arising in the various disciplines can be solved using the same mathematical tools (see maximum; minimum). In a typical optimization problem, the goal is to find the values of controllable factors determining the behaviour of a system (e.g., a physical production process, an investment scheme) that maximize productivity or minimize waste. The simplest problems involve functions (systems) of a single variable (input factor) and may be solved with differential calculus. Linear programming was developed to solve optimization problems involving two or more input variables. See also simplex method.