An Automobile Insurance Company Is in the Process of Reviewing

question 13

Multiple Choice

An automobile insurance company is in the process of reviewing its policies. The company is considering increasing the premium charged to drivers under 25. According to company records, 35 percent of the insured drivers are under the age of 25. The company records also show that 280 of the 700 insured drivers under the age of 25 have been involved in at least one automobile accident. On the other hand, only 130 of the 1,300 insured drivers 25 years or older have been involved in at least one automobile accident. An accident has just been reported. What is the probability that the insured driver is under the age of 25?

• A) 35%
• B) 20.5%
• C) 14%
• D) 68.3%
• E) 40%

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Definitions:

Pressures For Change

External and internal forces that motivate or compel organizations to alter their strategies, structures, or processes.

Global Markets

The international trading system that enables the exchange of goods, services, and currencies across borders.

Transform Cultures

The process of making significant and fundamental changes to the shared values, beliefs, norms, and practices within an organization to achieve desired outcomes.

Domestic Corporations

Companies that are incorporated in, and operate primarily within, the country they are registered.