Chris plans to study for an exam rather than surf the internet. he even prints out the slides. yet he ends up watching a movie because he finds the immediate costs of studying too high. his behavior can be explained by (a) the multi-self model; (b) standard discounted utility model; (c) quasi-hyperbolic model with naivete; (d) none of the above.

Brian has just finished college. he wants to set up a small business to make and sell fireworks. he registers his company and acquires a license from the government. he finds that most of his competitors are selling fireworks at an extremely low price. he would like to make more money, so he decides to innovate and develop better fireworks. he sells his fireworks at a higher price, and they are a huge hit with the customers. after a few years, he earns enough profit to set up a bigger fireworks factory that complies with the government’s health and safety regulations. he even starts exporting fireworks overseas. which type of economy does this scenario describe?