TABLE 2- 1
an Insurance Company Evaluates Many Numerical Variables $$\begin{array} { l l } \hline \mathrm { X } & \mathrm { f } \\\hline 1 & 14 \\2 & 18 \\3 & 12 \\4 & 5 \\5 & 1 \\\hline\end{array}$$

question 122

Multiple Choice

TABLE 2- 1
An insurance company evaluates many numerical variables about a person before deciding on an appropriate rate for automobile insurance. A representative from a local insurance agency selected a random sample of insured drivers and recorded, X, the number of claims each made in the last 3 years, with the following results.
$$\begin{array} { l l } \hline \mathrm { X } & \mathrm { f } \\\hline 1 & 14 \\2 & 18 \\3 & 12 \\4 & 5 \\5 & 1 \\\hline\end{array}$$
-Referring to Table 2-1, how many total claims are represented in the sample?

• A) 50
• B) 15
• C) 111
• D) 250

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Definitions:

Cross-Price Elasticity

A measure of how the demand for one product changes in response to a price change of another product.

Cereal

Grasses cultivated for the edible components of their grain, consisting of the endosperm, germ, and bran; also a common breakfast food made from processed grain.

Milk

A nutrient-rich liquid food produced by the mammary glands of mammals, commonly consumed by humans and used in a variety of dairy products.

Inelastic Demand

A situation where the demand for a good or service is relatively unaffected by changes in price.