(Table: Insurance Claims) Five people, who vary in health status, are considering buying health insuranc. Each person knowshis or her own health status and expected medical bills, which are given in the table. Assume that each person is equallylikely to file a claim.Annual ExpectedHealth Insurance ClaimPersonDarwin$30,000EdgarFranHildaJared20,00010,0008,0002,000Suppose that the insurance company does not know the health status of any one person but knows the expected claims of thegroup as a whole. If the insurance company sets the premium based on the average expected claims of these five people, thenpeople would be willing to pay the premium.O twoO fiveO threefourundefined

in this you have to find average of all and whose premium is below expected expenses will pay the…

(Table: Insurance Claims) Five people, who vary in health status, are his or her own health status and expected medical bills, which are gi likely to file a claim. Annual Expected Health Insurance Claim $30,000 20,000 Person Darwin Edgar Fran Hilda Jared 10,000 8,000 2,000 Suppose that the insurance company does not know the health status group as a whole. If the insurance company sets the premium based people would be willing to pay the premium. two

(Table: Insurance Claims) Five people, who vary in health status, are his or her own health status and expected medical bills, which are gi likely to file a claim. Annual Expected Health Insurance Claim $30,000 20,000 Person Darwin Edgar Fran Hilda Jared 10,000 8,000 2,000 Suppose that the insurance company does not know the health status group as a whole. If the insurance company sets the premium based people would be willing to pay the premium. two

Individual Income Taxes

43rd Edition

ISBN:9780357109731

Author:Hoffman

Publisher:Hoffman

Chapter5: Gross Income: Exclusions

Section: Chapter Questions

Problem 39P

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