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PDF-2thebanktocollectinterestatrater,andiftheinterestrateisconstant,itwill PDF document

3thatcertaintyandtimeconsistencyareequivalenttoDs1Ds1Dsor4DsDs1Ds11Ds115StrictstationarityrequiresthatDs1Kconstantwhichthengivestheexponentialdiscountingfunction

3thatcertaintyandtimeconsistencyareequivalenttoDs+(1)=Ds(+1)=Ds()or(4)Ds()=Ds(1)Ds+1(1):::Ds+1(1)(5)StrictstationarityrequiresthatDs(1)=K=constant whichthengivestheexponentialdiscountingfunction

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