People in a certain group have a 0.3% chance of dying this year. If a person in this group buys a life insurance policy for $3,300 that pays $1,000,000 to her family if she dies this year and $0 otherwise, what is the expected value of a policy to the insurance company?
A) $0
B) $300
C) $3,000
D) $3,300
B
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When the price of a hot dog rises 10 percent, your expenditure on hot dogs increases. Hence, it is certain that
A) hot dogs are a normal good for you. B) hot dogs are an inferior good for you. C) your demand for hot dogs is elastic. D) your demand for hot dogs is inelastic.
In the above figure, the efficient quantity of milk is
A) 10 million gallons per day. B) 5 million gallons per day. C) zero gallons per day. D) None of the above because all of the quantities are efficient.
Which of the following is a partially valid economic argument for restricting free trade?
a. Restrictions on foreign trade will increase employment and permanently reduce unemployment. b. Removal of restrictions that have existed for years will initially cause inflation. c. Infant industries need permanent protection to develop and gain productive efficiency. d. A nation needs to protect industries that are vital to national defense in case of future international conflict.
Opportunity cost can always be measured in money terms
a. True b. False Indicate whether the statement is true or false