The Idea of an Insurance Company "Pooling" the Risk Means

question 52

Multiple Choice

The idea of an insurance company "pooling" the risk means that

• A) the risk is completely eliminated from society.
• B) the insurance company requires buyers to pay a large deductible.
• C) the risk is spread over a large population.
• D) the insurance company insists on a pooling equilibrium.
• E) moral hazard and adverse selection are eliminated.

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Definitions:

Personal Objectives

Individual goals or targets that a person aims to achieve, which can influence their behavior and performance.

Organizational Politics

The activities and behaviors within an organization aimed at acquiring, developing, and using power and other resources to obtain one's preferred outcomes.

Resource Allocation

The process of assigning available resources, such as time, money, or personnel, to specific tasks, projects, or priorities.

Organizational Politics

The use of power and social networking within an organization to achieve changes that benefit the individual or a group, often at the expense of others.