-Jennifer Has the Utility of Wealth Curve Shown in the Figure

question 17

Multiple Choice

-Jennifer has the utility of wealth curve shown in the figure above. She owns a car worth $15,000, and that is her only wealth. There is a 10 percent chance that Jennifer will have an accident within a year. If she does have an accident, her car is worthless. An insurance company agrees to pay a car owner like Jennifer the full value her car, if the car owner buys the company's insurance policy. The company's operating expenses are $1,000. Jennifer will

• A) not buy the company's policy because the minimum premium that the company is willing to accept is greater than the maximum premium Jennifer is willing to pay.
• B) buy the company's policy because the minimum premium that the company is willing to accept is lower than the maximum premium Jennifer is willing to pay.
• C) buy the company's policy because the minimum premium that the company is willing to accept is the same as the maximum premium Jennifer is willing to pay.
• D) not buy the company's policy because Jennifer is risk neutral.

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Definitions:

Learning Climate

The overall atmosphere or environment that affects the mood and motivation of learners within an educational setting.

Lesson Plan

A detailed guide created by educators outlining the content, structure, and methodology of a lesson to be taught.

Compulsory Training

A required training program that employees must undergo to meet organizational standards or legal regulations.

Donald Kirkpatrick

The creator of a widely used model for evaluating the effectiveness of training programmes, consisting of four levels: reaction, learning, behaviour, and results.