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1. Imagine that you are a consultant for an insurance company which wants to issue a new insurance. Explain to your management (who are

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1. Imagine that you are a consultant for an insurance company which wants to issue a new insurance. Explain to your management (who are smart but not mathematically trained) how the amount of initial funds influences the risk of being ruined (loosing all the money). For example, what happens if the funds are doubled. Mention the assumptions made.

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