Ünite Sınavı Soruları

I. By combining the utility functions of the two periods with the discount function, we get the intertemporal utility function.

II. In the intertemporal utility function, there is no difference between the consumption of the 1st period and the 2nd period for the consumer.

III. The instantaneous utility function captures an individual’s utility from consumption at time t.

What can be said to be true about the intertemporal utility function?

I. Individuals can choose to avoid time-inconsistent choices by controlling their long-term demands by including the income they will earn today.

II. The individual is aware of his consumption pleasures, which will result in no effort to adapt to the future situation. 

III. Past consumption decisions will affect the individual’s future consumption decisions.

Which of the given reasons may cause the long-run and short-run demand function to differ according to Pollak (1970)?

According to the EDU model, what is the only factor determining the individual’s total utility?

I. The Reference Time Model is similar to the habit formation model, it does not include the past as a whole but with a reference time and a reference output level dimension.

II. In order to understand time-inconsistent behaviors, a reference-dependent utility was formed based on the contributions of prospect theory to utility theory.

III. In the Reference Time Model, when the individual gains more than a certain amount, a new income that had a great impact before will have a stronger effect.

What can be said to be true about the Reference Time Model (RT)?

Which one of the given statement can be said to be true about the properties of the EDU (Exponential Discounted Utility) Model?

What is the behavior of absolute magnitudes being essential to individuals’ intertemporal preferences called by Loewenstein and Prelec (1992)?

I. Living the experience today will lead to more good memories one day than living it tomorrow.

II. Uncertainty makes today’s consumption more valuable. 

III. Consuming today is less valuable than consuming tomorrow.

Which of the given are some of the reasons the consumer values today’s consumption more?

What is the general name for the trade-off of costs and benefits that occur at different times?

I. In many studies conducted to test the assumptions of the EDU model, it has been found that the intertemporal preferences of the individuals do not match the assumptions of the model.

II. Contrary to the EDU model claims, people’s discount rate is not fixed. For an individual; the desire for instant gratification will be unbearable the closer the time is.

III. The Discounted Utility model differentiates between gains and losses in terms of discounting. Individuals discount gains at a higher rate than losses.

What can be said to be true about the anomalies of the EDU (Exponential Discounted Utility) Model? 

What is the rate at which the discount function declines over time?