Fair insurance
A) has an expected value for the policy holder of zero.
B) has a positive expected value for the insurance company.
C) has very high insurance premiums.
D) is available only to those who fully insure.
A
You might also like to view...
The Cambridge k is all of the following except
A) the reciprocal of the income velocity of money. B) a transactions demand for money. C) the fraction of GDP that people wish to hold in the form of money balances. D) the velocity of money.
Which of the following is an example of a transaction cost?
a. fees for attorneys negotiating the agreement b. the damage done to the environment by a negative spillover c. the money transferred between parties to purchase equipment d. taxes collected on the goods whose production causes pollution
If people decide to hold some of their cash and not deposit it, then the:
A. money multiplier overestimates how much money will be created in the economy. B. reserve ratio is not fully functioning, and should be raised. C. reserve ratio is not fully functioning, and should be lowered. D. money multiplier underestimates how much money will be created in the economy.
Unemployment insurance could affect unemployment by:
A. changing the incentives of those unemployed and looking for work. B. decreasing the amount of frictional unemployment. C. increasing the equilibrium level of unemployment. D. All of these are true.