Which of the following is not an example of the issue of time inconsistency?
A)a central bank announced to maintain low inflation and at the same time increased money supply
B)a government stated that they will not negotiate with hostage takers. When someone is taken hostage, it negotiates
C)a mom says to her kids no cookie before meals and she never gives cookies before her kids eat their meals
D)a person on diet eats ice cream for dinner

Question

Quizplus · Accepted Answer

Time inconsistency refers to a situation where a decision-maker's preferences change over time, leading to a different decision than initially planned. In option C, the mom consistently adheres to her rule, showing no change in preference or decision over time.

Which of the Following Is Not an Example of the Issue