The Purpose of a High-Risk Pool Is to

question 57

Multiple Choice

The purpose of a high-risk pool is to

• A)provide insurance for poor drivers.
• B)reduce medical costs associated with auto accidents.
• C)take unsafe drivers off the road.
• D)reduce auto insurance premiums with state regulation.
• E)offer premium discounts to safe drivers.

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Definitions:

Useful Life

The estimated period over which a fixed asset is expected to be useful to the owning entity, crucial for calculating depreciation.

Machine

Equipment or devices designed to perform specific tasks, often used in manufacturing and production processes.

Internal Rate

Commonly denotes the internal rate of return (IRR), the discount rate at which the net present value (NPV) of all cash flows from a specific project is zero.

Cash Operating

The process dealing with the direct cash flows from business operations, emphasizing a company's liquidity in the short term.