Answer:
PV = $155,343
Explanation:
This question requires application of PV of annuity, according to which:
PV = p [1-(1+r)^-n/r]
P= Periodic Payment
r = rate of period
n = number of periods
r = 3%/12 = 0.25% (monthly), n = 120, P = $1500
PV = 1500 * [\frac{1 - (1 + 0.0025)^{-120}}{0.0025}]
PV = 1500 * 103.5618
PV = $155,343
Ashley is not happy. (is this the full question?... it looks like it is missing the last sentence
Answer: adverse selection
Explanation:
From the question, we are told that an
insurance company is likely to attract customers like Clancy who want to purchase insurance because he knows better that the company that he is more likely to make a claim on a policy.
The idea above is called adverse selection. This is a situation whereby either the seller or the buyer believes that he or she has more information than the other person regarding a particular product.
Answer: d. supply at different prices after the entry and exit of firms is completed.
Explanation:
The industry supply curve simply shows the relationship that exist between the price at which a good is sold and the industry's total output.
The long-run industry supply curve simply refers to the graphic representation of the quantity of output that the industry is prepared to supply at different prices after the entry and exit of firms has been completed.
At the long-run industry supply curve, it depicts the locus of price and the output produced in that industry as each firm aims to maximize profit.
