The Idea of Time Inconsistency

question 2

Multiple Choice

The idea of time inconsistency:

• A) explains how it can be rational for someone to say he's going to eat a salad for dinner each night this week and end up eating pizza four out of five nights instead.
• B) explains how it can be rational for someone to pay more for something on his credit card than if he were to pay cash for the same thing.
• C) explains why people refuse to ignore only some sunk costs.
• D) Time inconsistency doesn't explain any of these behaviors.

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Definitions:

Stringency

refers to the strictness, exactness, or severity in the application of rules or standards.

Punishment

A form of social control involving the application of an unpleasant stimulus or penalty in response to undesired behavior, aiming to decrease that behavior.

Degrees

Degrees are academic qualifications awarded by colleges or universities, representing a level of education or expertise achieved in a specified field of study.

Varieties

Different types, categories, or forms of a specific thing, emphasizing diversity within a group or category.