A Risk Premium Is

question 9

Multiple Choice

A risk premium is:

• A)a payment to an insurer by a policy-holder who faces a potential loss.
• B)equal to the purchase price of an insurance policy.
• C)the necessary difference between the expected value of a lottery and the payoff of a sure thing to make the decision maker indifferent between the lottery and the sure thing.
• D)the difference between the expected value and the variance of a lottery.

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Definitions:

Dream Control

Dream control, or lucid dreaming, involves being consciously aware during a dream and potentially being able to influence the direction and content of the dream experience.

Night Terror

A sleep disorder causing feelings of panic or dread typically occurring during the first hours of stage 3-4 non-REM sleep and often resulting in loud screams or physical actions.

Piercing Cry

A very loud and high-pitched scream or shout, often indicating distress or alarm.

REM Deprivation

The condition of being deprived of Rapid Eye Movement sleep, a stage of sleep associated with dreaming, which can lead to various psychological and physiological effects.