The worth of consumer's house is 160, and her utility function is u(w) = √w. The probability of outbreak of fire is p = 1/2, and the fire will make 120 amount of loss of worth of house. Under the given conditions, consumer can join insurance that pay insurance money as B by pay insurance fee qB. (a) Find the amount of insurance that consumer will join. (b) Derive the condition that consumer will not join insurance. (c) Derive the condition that make consumer join full insurance. (d) Find the B, when the q is given as q = 3/5

In his best seller Wealth Without Risk, Charles J. Givens, the self-styled expert on “low-risk ways to achieve and hold on to wealth,” offers the following advice as his  strategy #32: “Buy disability insurance only if you are in poor health or accident prone.” What is your reaction to this “strategy?”

You are the wage earner in a "typical family," with $28,000 gross annual income. Use the easy method to determine how much life insurance you should carry. (Do not round intermediate calculations.) Life insurance need

Give typing answer with explanation and conclusion

2. Which of the following risks are insurable? For risks which are not insurable, explain why they are not insurable.(i) The risk that a $10 Christmas decoration will be broken.(ii) The risk that a borrower will need to pay interest on a debt.(iii) The risk that the interest rate on a debt will increase.(iv) The risk that an insurance company will have to pay too many losses.(v) The risk that an individual is late for an important meeting.(vi) The risk that a pregnancy will result in multiple births (twins, triplets,etc.) incurring unplanned expenses.(vii) The risk of an individual being killed by a malfunctioning self-flyingaeroplane within the next 30 years.(viii) The risk that a dress will not be fashionable in two month’s time.

When you go to an open house, the realtor there: 1. works for the seller 2. works for you 3. wont talk to you if you have your own realtor

Whole Life insurance is often called ordinary life, or cash-value life insurance. This type of life insurance also gives you three guarantees. Select those three. The promise that your premium payments will decrease as you progress into your policy A guaranteed minimum rate of return on your cash value account A guaranteed death benefit amount The promise that your premium payments will not go up

An insurance company is considering providing fire insurance for $120,000, $100,000, or $80,000 to the owner of a house with a market value of $100,000. a) How much insurance is the company likely to sell for the house? Why? b) If the probability of a fire is 1 in 1000, what would be the premium charged by the company?

What is the BEST option to reduce your insurance costs if you were recently in an accident?         Drive safely so you don't have any accidents.         Take a safe driving class.         Buy a newer car.         Drive without insurance.

A consumer’s demand for a medical service is Q=100−PP where PP is the out-of-pocket price she actually faces. She is considering four different insurance options: uninsurance, full insurance, a 50% coinsurance plan, and a copayment plan with a $25 copay. a. Assume this service has a list price of PL =$70. Calculate Q under each insurance plan.b. Calculate the amount of social loss under each insurance plan.c. Derive a general expression for social loss as a function of x and PL, where x is the copay amount under a copayment plan. For simplicity’s sake, assume x<PL.d. Derive a general expression for social loss as a function of y and PL, where y is the coinsurance rate.