What would be the actuarially fair premium for an insurance policy that pays $1,000 in the event of a loss that has a 25% chance of occurring?
A. $250
B. $750
C. $1,250
D. $500
A. $250
You might also like to view...
Using marginal analysis, an economist would judge the proper distribution of government spending by comparing
A. the amount spent with the amount spent in the previous year. B. whether the last dollar spent on one program would have been better spent on another. C. whether the last dollar spent would have been better left in private hands. D. whether the last dollar spent garnered any value to society.
If D equals the maximum amount of new demand-deposit money that can be created by the banking system on the basis of any given amount of excess reserves; E equals the amount of excess reserves; and m is the monetary multiplier, then:
A. m = E/D. B. D = E × m. C. D = E - 1/m. D. D = m/E.
Refer to the diagram. The marginal utility of the third unit of X is:
A. 5.
B. 4.
C. 2.
D. 15.
Answer the question based on the following list of items that are related to aggregate demand and/or aggregate supply.
Refer to the list above. A change in which factor is most likely to change both aggregate demand and aggregate supply?
A. 3
B. 5
C. 7
D. 6