Which of the following behaviors contradict the standard discounted utilitymodel? (A) hyperbolic discounting; (B) context effects; (C) preference for commitments; (D) all of the above.
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1. Which of the following behaviors contradict the standard discounted utilitymodel?
(A) hyperbolic discounting;
(B) context effects;
(C) preference for commitments;
(D) all of the above.
2. A nudge is a policy solution that is(A) cheap to implement;(B) has a predictable effect on agents’ behavior;(C) does not put additional constraints on agents’ freedom of choice;(D) all of the above.
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- Emma has a utility function U(x1, x2, x3) = log x1 + 0.8 log x2 + 0.72 log x3 over her incomes x1, x2, x3 in the next three years. This is an example of (A) expected value; (B) quasi-hyperbolic utility function; (C) standard discounted utility; (D) none of the above. Emma’s preferences can exhibit which of the following behavioral patterns? (A) preference for flflexibility; (B) context effffects; (C) time inconsistency; (D) intransitivity.The Foundations of Behavioral Economic Analysis Consider the following property of choice correspondence : Show that maximization of complete and transitive preference satisfies β-axiom. I need this ASAPWhich of the following behaviors contradict the standard discounted utility model? (A) hyperbolic discounting; (B) context effffects; (C) preference for commitments; (D) all of the above.
- It is given that a typical consumer has a well-behaved preference structure for his consumption bundle, which includes only two goods, A and B. Further, assume that commodity A is normal and commodity B is Giffen. By keeping commodity A on the x-axis and commodity B on the y-axis, you are required to show the price decomposition for commodity B when $PB decreases exogenously relative to $PA.Emma has a utility functionU(x1, x2, x3) = logx1+ 0.8logx2+ 0.72logx3 incomes x1 , x2, x3 in the next three years. This is an example of (A) expected value; (B) quasi-hyperbolic utility function; (C) standard discounted utility; (D) none of the above.Let b(p,s,t) be the bet that pays out s with probability p and t with probability 1−p. We make the three following statements: S1: The CME for b is the value m such that u(m)=E[u(b(p,s,t))]. S2: A risk averse attitude corresponds to the case CME smaller than E[b(p,s,t))]. S3: A risk seeking attitude corresponds to a convex utility function. Are these statements true or false?
- Identify a personal economic decision that was driven by a behavioral bias rather than by pure rational behavior. Given your understanding of behavioral economics, how would your decision differ today? Please provide a detailed discussion. I will not give a positive rating for vague responses.Emma has a utility functionU(x1, x2, x3) = logx1+ 0.8 logx2+ 0.72 logx3over her incomes x1, x2, x3 in the next three years. This is an example of(A) expected value;(B) quasi-hyperbolic utility function;(C) standard discounted utility;(D) none of the above. Emma’s preferences can exhibit which of the following behavioral patterns?(A) preference for flexibility;(B) context effects;(C) time inconsistency;(D) intransitivity.Could you please write your own words, not copy-paste or plagiarism issues Question: Discuss the concept of an “overconfidence bias” and why this bias can be seen as being a “double edged sword” in the context of behavioral economics
- ***PLEASE NOTE: QUESTION HAS TWO PARTS REQUIRING ANSWER*** Q: Johnny Football has a utility function of the form ? = √?. Johnny is beginning his senior year of college football. If he is not seriously injured, he will receive a $1,000,000 contract for playing professional football. If any injury ends his football career, he will take a job as a refuse removal facilitator in his hometown that pays $10,000. There is a 10% chance that Johnny will be injured badly enough to end his career. a. What is Johnny’s expected utility? b. How much would Johnny be willing to pay to remove the financial riskhe faces? That is, what $p would he pay for a $1,000,000 insurancepolicy so that he would have $1,000,000-$p even if he had a seriousinjury? Assume he wouldn’t work for $10,000 if he had the insuranceand he was injured. Hint: You should set his utility with certainty(U($1,000,000-$p)) equal to his expected utility with risk (found inpart a) and solve for p.‘‘Risk-averse people should only be averse to big gambles with a lot of money at stake. They should jump on any small gamble that is unfair in their favor.’’ Explain why this statement makes sense. Use a utility of income graph like Figure 4.1 to illustrate the statement. For a challenge, demonstrate the statement using a two-state graph like Figure 4.6.Select the correct option : When the expected utility of offer A is larger than offer B, a rational individual would always prefer offer A to offer B. 1. True 2.False