Problem Set 7

Due: April 9, 2015 Economics 1030

Problem 1 (When should I do a project?): If you get stumped, the

answers to this problem will be posted by the evening of Monday,

April 6 (before the problem is due).

                                             1

a. Consider a quasi-hyperbolic naive with 2

                                                 and   1 Time is indexed

 by the whole numbers,   {0  1  2  }

The naif has to nish a project by deadline  .

                                                         3 

In time period   the (undiscounted) project costs     2

                                                                utils to execute.

When...