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14 1 point Nadia just bought a car worth $10,000. She lives in a sketchy area where the probability that the car will be stolen

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14 1 point Nadia just bought a car worth $10,000. She lives in a sketchy area where the probability that the car will be stolen in any given year is 10% (leaving her with $0). Suppose that when Nadia gets D dollars, her payoff is defined to be D() in order to model her level of risk-aversion. An insurance company is willing to offer full insurance (give $10,000 to replace the car if it is stolen), but only at price above the expected cost of insuring the car. The transaction between Nadia and the insurance company choose your answer... occur because the expected cost to the insurance company of 1 insuring the car is $ choose your answer... V , which is choose your answer... AV Nadia's maximum willingness to pay for the insurance. choose your answer... 2

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