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Question 4 Suppose that there are three movies each in a week. In week 1, we have Mediocre movie that generates 3 utils (unit of
Question 4 Suppose that there are three movies each in a week. In week 1, we have Mediocre movie that generates 3 utils (unit of utility). In week 2, we have Good movie that generates 5 utils. In week 3, we have Johnny Depp movie that generates 8 utils. Assume that the agent has quasi-hyperbolic discounting with B = 0.5 and 6 = 1, and that the agent must give up exactly one movie and receive 0 util in that week. (a) If the agent is fully naive, which movie will he/ she give up? (b) If the agent is fully sophisticated, which movie will he/ she give up
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