In a Small Island Population, Half of the People Are

question 65

Multiple Choice

In a small island population, half of the people are healthy and half are sick. The annual expected medical claims of the healthy and sick are $200 and $4,000, respectively. Assume that the health insurance company does not know whether people are healthy or sick before they buy insurance. If the health insurance company charges an annual premium of $2,100 (the average expected claim) , only the _____ will buy insurance, driving future premiums _____.

• A) sick; up
• B) healthy; down
• C) sick; down
• D) healthy; up

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Definitions:

Implanted

Implanted refers to the insertion or embedding of an object or substance into the body, often for medical purposes such as implants or grafts.

Vitamins A

A group of fat-soluble vitamins that play an essential role in vision, growth, cell division, reproduction, and immunity.

Vitamins D

A group of fat-soluble secosteroids responsible for increasing intestinal absorption of calcium, magnesium, and phosphate, and multiple other biological effects, primarily known for their role in bone health.

Teratogens

Environmental influences or agents that can damage the embryo or fetus.