If $\beta 1$ in your lifetime utility function, then:
A) your utility function displays increasing marginal returns
B) you are risk averse
C) you prefer utilities received today relative to the future
D) you prefer utilities received in the future relative to today
E) Not enough information is given.

Question

If $\beta > 1$ in your lifetime utility function, then:
A) your utility function displays increasing marginal returns
B) you are risk averse
C) you prefer utilities received today relative to the future
D) you prefer utilities received in the future relative to today
E) Not enough information is given.

Quizplus · Accepted Answer

If $\beta > 1$, it indicates a preference for future utility over present utility, as future utility is weighted more heavily.

If β>1\beta > 1β>1 In Your Lifetime Utility Function, Then: A) Your Utility Function

If $\beta > 1$ In Your Lifetime Utility Function, Then:
A) Your Utility Function