If individuals make intertemporal choices using "hyperbolic discounting", this may create inefficient choices because individuals will:
a. not take account of their time preferences
b. make choices that are inconsistent over time.
c. have a preference for only consuming in the future.
d. confuse nominal and real interest rates.
b
You might also like to view...
Which of the following is likely to shift the production possibilities curve of a nation rightward?
A) An increase in the education and experience of the workforce B) An increase in the demand for the nation's exports C) An improvement in the terms of trade that the nation faces D) An increase in the price of raw materials used by the nation
An expansionary monetary policy is likely to increase real output more than just temporarily:
a. when actual output currently is beyond the economy's long-run capacity. b. when the economy currently is at full employment c. when the economy currently operates at less than capacity. d. at virtually any output level.