Insurance premiums represent:
A. more than the expected value of the payout the company will give to individuals who are insured.
B. peace of mind and are unrelated to the expected value of the payout the company will give to individuals who are insured.
C. the expected value of the payout the company will give to individuals who are insured.
D. less than the expected value of the payout the company will give to individuals who are insured.
Answer: A
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The self-correcting tendency of the economy means that rising inflation eventually eliminates:
A. unemployment. B. exogenous spending. C. recessionary gaps. D. expansionary gaps.
The more human capital workers have, the:
A. more productive they are. B. more technology they will require for their job. C. lower the value of their marginal product. D. less productive they are.
What did Friedman and Phelps predict would happen if policymakers tried to move the economy upward along the Phillips curve? Did the behavior of the economy in the late 1960s and the 1970s prove them wrong?
Which of the following statements is FALSE?
A. An equal distribution of income would eliminate absolute poverty. B. In a relative sense, the problem of poverty will always exist. C. An equal distribution of income would eliminate relative poverty. D. The official absolute poverty level in the United States is far above the average income of many countries in the world.