In general, activists are ________ about the ability of the economy to remain stable and non-activists are ________

People in a certain group have a 0.3% chance of dying this year

If a person in this group buys a life insurance policy for $3,300 that pays $1,000,000 to her family if she dies this year and $0 otherwise, what is the expected value of a policy to the insurance company? A) $0 B) $300 C) $3,000 D) $3,300

You cause a fire insurance company to face a moral hazard problem when you take ________ you buy fire insurance from the company.

A. fewer precautions to prevent fires after B. fewer precautions to prevent fires before C. the same precautions to prevent fires before and after D. more precautions to prevent fires after