1. Economists have known for many decades that individuals experience the emotions of dread and anticipation, but why is it necessary to incorporate these into economic models? 2. You are given the option of when you would like to drive a Ferrari for a day. You may choose any time in the next four days [today [t=0], tomorrow [t=1], ...]. Your consumption utility for driving a Ferrari is u(c] = [1003; where c is the number of days driving a Ferrari. You have a daily discount rate of0.5. a. b. Using the standard economic model of exponential discounting, when do you choose to drive the Ferrari? If you derive utility from only anticipation, not consumption, and your or = 2 when do you drive the Ferrari? If you derive utility from anticipation and consumption and your or = 2 when do you drive the Ferrari? 3. You are given the option of when you would like to wash your neighbor's car. You may choose any time in the next four days [today [t=0), tomorrow [t=1], ...]. Your consumption utility for washing a car is u(c] = -50c. You have a daily discount rate of 0.25. a. b. Using the standard economic model of exponential discounting, when do you choose to wash your neighbor's car? If you derive utility from anticipation and consumption and your a = 1 when do you wash the car? If you derive utility from anticipation and consumption and your or = 3 when do you wash the car? When do you wash the car ifoc = 3, but your daily discount rate is now 0.99