The slope of a hyperbolic discount function ________________ as we move through time.
A) stays constant
B) equals -$\delta$
C) changes

Question

Quizplus · Accepted Answer

The slope of a hyperbolic discount function changes as we move through time, according to the formula: k/(1 + $\delta$t), where k is a constant and $\delta$ is the discount rate. As t increases, the denominator becomes larger, causing the slope to decrease. Therefore, the discount function becomes less steep over time.

The Slope of a Hyperbolic Discount Function ________________ as We δ\deltaδ

The Slope of a Hyperbolic Discount Function ________________ as We $\delta$