Insurance companies:
A. profit from the difference between the premiums paid and the expected value of clients' payouts.
B. only profit by selling to risk neutral clients.
C. must charge less than the expected value of payout, otherwise they would go out of business.
D. All of these statements are true.
A. profit from the difference between the premiums paid and the expected value of clients' payouts.
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The hidden momentum of population growth is caused by
(a) the demographic transition. (b) population age structure. (c) the opportunity cost of a woman's time. (d) children's contribution to income.
Which type of legislation has widespread benefits and widespread costs?
a. traditional public-goods b. special interest c. populist d. competing interest
According to the rational choice model developed in this chapter, which statement below is false?
A. Cash grants are always better than in-kind gifts. B. Individual preference patterns do not change because prices change. C. Consumers behave as if they did cost-benefit analysis on every purchase. D. People would be less happy if they exchanged money rather than things at Christmas.
A benefit to consumers of monopolistically competitive markets is that:
A. consumers only have to choose from one product. B. consumers have a variety of products from which to choose. C. goods are sold at the lowest possible average cost of production. D. price is equal to marginal cost in equilibrium.