In microeconomics, the **expenditure minimization problem** is another perspective on the utility maximization problem: "how much money do I need to reach a certain level of happiness?". This question comes in two parts. Given a consumer's utility function, prices, and a utility target,

- how much money would the consumer need? This is answered by the expenditure function.
- what could the consumer buy to meet this utility target while minimizing expenditure? This is answered by the Hicksian demand function.

Read more about Expenditure Minimization Problem: Expenditure Function, Hicksian Demand Correspondence

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### Famous quotes containing the words problem and/or expenditure:

“Any solution to a *problem* changes the *problem*.”

—R.W. (Richard William)

“To predict the behavior of ordinary people in advance, you only have to assume that they will always try to escape a disagreeable situation with the smallest possible *expenditure* of intelligence.”

—Friedrich Nietzsche (1844–1900)

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