An Insurance Company Will Insure a $75,000 Hummer for Its

question 114

Multiple Choice

An insurance company will insure a $75,000 Hummer for its full value against theft at a premium of $1500 per year.Suppose that the probability that the Hummer will be stolen is 0.0075.Calculate the insurance company's expected net profit.

• A)$937.50
• B)$551.25
• C)$1488.75
• D)$562.50

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Definitions:

Intelligence

An individual’s ability to understand complex ideas, to adapt effectively to the environment, to learn from experience, to engage in various forms of reasoning, and to overcome obstacles through mental effort.

Pleasing Disposition

A temperament or personality that is generally agreeable and pleasant to interact with.

Dependable Character

A quality of being reliable and trustworthy, showing consistency in actions and behavior over time.

Socially Outgoing

Characteristic of a person who is open, friendly, and inclined towards social interaction.