Author Question: Assume that a single insurance plan applies to 2,000 low-risk people and 1,000 high-risk people ... (Read 39 times)

cabate · **on:** Jun 30, 2018

Assume that a single insurance plan applies to 2,000 low-risk people and 1,000 high-risk people opting for insurance coverage. If the average claim submitted by low-risk people is 100 while that submitted by high-risk people was 1,000 . the insurer would break even by setting a premium of:
a. 250.
b. 400.
c. 200.
d. 500.

Question 2

The structure of an organization is influenced by transactions costs.
Indicate whether the statement is true or false