Which of the Following Is Implied by the Pooling of Losses

question 30

Multiple Choice

Which of the following is implied by the pooling of losses?

• A)sharing of losses by an entire group
• B)inability to predict losses with any degree of accuracy
• C)substitution of actual loss for average loss
• D)increase of objective risk

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Definitions:

Price Sensitivity

The degree to which the demand for a product changes in response to a change in its price.

Marketing Mix

The combination of factors that can be controlled by a company to influence consumers to purchase its products, typically including product, price, place, and promotion.

Variable Costs

Expenses that vary directly with the level of production or output, such as materials and labor.

Fixed Costs

Expenses that do not change in proportion to the activity of a business, such as rent, salaries, and equipment maintenance costs.