Question is attached

1.In contrast to the exponential model, the quasi-hyperbolic discounting model says that . That is, discount factors in this model are equal to , where 0

a.What is the discount factor for t=0? (3 points)

b.Assume that a quasi-hyperbolic discounter has a value of 0.75 and a value of 0.96. What is the discount factor for t=1? (3 points)

c.Assume that a quasi-hyperbolic discounter has a value of 0.75 and a value of 0.96. What is the discount factor for t=2? (3 points)

d.When you divide your answer from part b) by your answer for part a) what do you get? (2 points)

e.When you divide your answer from part c) from your answer to part b) what do you get? (2 points)

f.Based upon your answers from parts d) and e) what can you say about quasi-hyperbolic discounters? (5 points)

. In contrast to the exponential model, the quasi-hyperbolic discounting model says that PV = F VD + BSFV1 + + BET FVT. That is, discount factors in this model are equal to {11532: i; 3:? }, where 0