Which Statement Is (Are)true Regarding Property and Liability Insurance Market

question 9

Multiple Choice

Which statement is (are) true regarding property and liability insurance market conditions?
I.Premiums are high when the insurance market is "hard."
II.Underwriting standards are tight when the insurance market is "soft.

• A)I only
• B)II only
• C)both I and II
• D)neither I nor II

Apply mathematical operations to solve practical problems in finance.

Understand and apply basic arithmetic operations and properties to solve real-world problems.

Calculate and analyze the impact of sales taxes on retail transactions.

Compute and interpret the average cumulative investment over a time period.

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Definitions:

Marginal External Cost

The cost imposed on a third party not involved in a transaction or activity due to an additional unit of production.

Methane Gas

A potent greenhouse gas with a simple chemical formula CH4, commonly produced by the decomposition of organic materials and digestive processes of animals.

Sulfur Emissions

The release of sulfur compounds into the atmosphere, primarily from the burning of fossil fuels, which can cause environmental damage.

Coase Theorem

The proposition that even in the presence of externalities an economy can always reach an efficient solution as long as transaction costs are sufficiently low.