Which of the Following Is a False Statement

question 45

Multiple Choice

Which of the following is a false statement?

• A) Risk averse people will pay an insurance premium that is greater than the mathematically fair chance of loss in order to relieve themselves of uncertainty.
• B) A risk seeker is willing to assume risk.
• C) The mathematically fair price for insurance is the objective risk for the insurer multiplied by the maximum possible loss.
• D) Insurance is never a mathematically fair trade because the insurer adds several operating and other costs to loss costs when it calculates the premium.

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Definitions:

Technical Support

Assistance provided to customers or users with technology products or services, often regarding software, hardware, or other electronic or mechanical goods.

Debugging Software Errors

The process of identifying, analyzing, and correcting bugs in software.

External Failure Cost

Costs incurred when products or services fail to meet quality standards after being delivered to the customer, including returns, repairs, and warranty claims.

Quality Cost Report

A document that details the costs associated with ensuring product quality, including prevention, appraisal, and failure costs.