Under Which Type of Automobile Insurance Arrangement Are All Automobile

question 5

Multiple Choice

Under which type of automobile insurance arrangement are all automobile insurers in a state assigned their proportionate share of high-risk drivers based on the total volume of automobile business written in the state?

• A)automobile insurance plan
• B)unsatisfied judgment fund
• C)reinsurance facility
• D)specialty automobile plan

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Definitions:

Traceable Fixed Expenses

Fixed costs that can be directly linked to a specific business segment, department, or product and would disappear if the segment was eliminated.

Variable Expenses

Costs that change in proportion to business activity or production volume, such as materials costs, direct labor, and utilities for machinery.

Minimum Required Rate Of Return

The lowest acceptable return on an investment, used as a benchmark for evaluating potential investments.

Average Operating Assets

This refers to the average value of the assets used in operations over a certain period, which can indicate the efficiency of asset use in generating income.