Insurance Is Not a Good Option for Managing Risk When

question 57

Multiple Choice

Insurance is not a good option for managing risk when

• A) the probability of loss is very small and the expected loss is small.
• B) the benefits outweigh the costs.
• C) you want to protect your existing and future net worth.
• D) there is a likelihood that an event will cause a large financial loss.

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Definitions:

Life Expectancies

The average period that an individual is expected to live, based on current mortality and health trends.

TV Sets

TV sets refer to devices equipped with a tuner and a screen used for receiving and displaying television broadcasts.

Scatterplot

A graphical representation using dots to show the relationship between two sets of data.

Correlation

A quantitative indicator reflecting the level at which two variables fluctuate concurrently, indicating both the magnitude and direction of their connection.