Will and Becky are two college students who are planning on Sunday how much they will study on Monday for a test on Tuesday. Will weighs future utility the same as current utility. Becky is more impulsive. She puts weight 1 on current period utility but only weight w on utility earned in future periods where 0 < w < 1. Let s be the cost in terms of utility on Monday from studying. Let b be the benefit in terms of utility on Tuesday from studying and thus performing well on the test.
a. Under what condition on s and b would will plan to study for the test? What condition is required for him to carry through on his plan?
b. Under what conditions on s and b would Becky plan to study for the test? What condition is required for her to carry through on her plan?