A Fair Insurance Policy Is One Whose Premium

question 158

Multiple Choice

A fair insurance policy is one whose premium:

• A)is zero.
• B)allows the insurance company to profit.
• C)equals the expected value of the claims.
• D)is higher as the probability of a claim decreases.

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Definitions:

Loans

Sums of money borrowed that are expected to be paid back with interest.

Potential Lender

An individual or institution considering the provision of loans or credit to businesses or individuals, assessing risk and return before decision-making.

Small Business Manager

A person responsible for directing the operations, managing the staff, and ensuring the profitability of a small business.

Actions

The steps or measures taken to achieve a particular goal, often planned and executed to effect change or produce a desired outcome.