Which of the Following Factors Is Not Considered When an Insurance

question 1

Multiple Choice

Which of the following factors is not considered when an insurance rate or premium is calculated?

• A)the cost of the actual losses
• B)the cost of the insurance salesman and other company expenses
• C)investment earnings on prepaid premiums
• D)McCarran-Ferguson Act

---

Definitions:

Say's Law

The principle that supply creates its own demand, meaning production necessarily leads to an equivalent level of demand in the economy.

Monetarists

Monetarists believe in the control of the supply of money as the primary method of controlling inflation and stabilizing the economy.

Balancing the Budget

The process of adjusting income and expenditure so that they equal each other, resulting in neither a budget deficit nor a surplus.

Money Supply

The total amount of monetary assets available in an economy at a specific time, including cash, bank deposits, and other liquid assets.