1.Oligopoly is a market structure that is characterized by a_____number of_____firms that produce_____ products.

a) large; relatively small and independent; differentiated

b) small; interdependent; identical or differentiated

c) large; relatively small and independent; identical

d) small; independent; identical or differentiated

2.The Baker family is faced with two possible states.In state 1they remain healthy and incur no medical expenses.In state 2,their medical expenses will be $8 000. There is a 30% chance that state 1 will occur and a 70% chance that state 2 will occur. An insurance company offers to pay all of their medical expenses for a premium of $6 000.From the Bakers point of viewthis is a fair insurance policy

a) False b) True