A decision maker with hyperbolic preferences is very
A) patient
B) impatient
C) patient or impatient depending on a random distribution

Question

Quizplus · Accepted Answer

A decision maker with hyperbolic preferences is generally more impatient than a decision maker with exponential preferences. This is because hyperbolic preferences lead to a higher discount rate in the short term, meaning the decision maker is willing to sacrifice more long-term gain for immediate gratification.

A Decision Maker with Hyperbolic Preferences Is Very