In an Ad for Insurance, the Text Reads "Life's an Adventure

question 169

Multiple Choice

In an ad for insurance, the text reads "Life's an adventure, and there are plenty of perils awaiting your jewelry: a lost or broken stone, theft, accidental loss, damage, mysterious disappearance Have you thought about insurance?" What is the economic reasoning for an individual to buy insurance?

• A) Individuals who buy insurance are profit maximizers.
• B) Individuals who buy insurance are rational.
• C) Individuals who buy insurance are dishonest and can profit from dishonesty.
• D) Individuals who buy insurance increase their expected utility by owning insurance.

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Definitions:

Condominium Development

A real estate project involving the division of a property into individual ownership units along with shared ownership of common areas.

Operating Expenses

Regular costs associated with running a business or an organization, such as salaries, rent, utilities, and equipment maintenance.

Unit Owner

A person or entity that legally owns a single unit within a multi-unit property, such as a condominium or an apartment within a complex.

Escheat To The Crown

A legal process where unclaimed or ownerless land and property revert back to the state or monarch.