6. Supply of insurance

1. Define:
   1. Actuarially fair premium
   2. Full Insurance

Using the table below, answer the following questions -

2. For Individual A the full insurance amount is _________________ & the actuarially fair premium is ________
3. For Individual B the full insurance amount is _________________ & the actuarially fair premium is ________
4. For Individual C the full insurance amount is _________________ & the actuarially fair premium is ________
5. For Individual D the full insurance amount is _________________ & the actuarially fair premium is ________
6. Assume that an insurance company offers to cover individuals upto a maximum of $35,000 a year. They charge a premium of $1300 a year.
   1. For whom is this actuarially fair & full
   2. For whom is this insurance unfair & partial
   3. For whom is this insurance unfair & full

Please answer ASAP

Individual A Sick Risk 5% Healthy 95% 100,000 316 Income 50,000 224 Utility Individual B Sick Risk Healthy 99% 100,000 316 Income Utility 1% 35,000 187 Individual C Sick Risk 10% 80,000 Healthy 90% 100,000 316 Income Utility 283 Individual D Sick Risk 1% Healthy 99% 100,000 316 Income 95,000 Utility 308 Individual A Sick Risk 5% Healthy 95% 100,000 316 Income 50,000 224 Utility Individual B Sick Risk Healthy 99% 100,000 316 Income Utility 1% 35,000 187 Individual C Sick Risk 10% 80,000 Healthy 90% 100,000 316 Income Utility 283 Individual D Sick Risk 1% Healthy 99% 100,000 316 Income 95,000 Utility 308