QUESTION 1 Assumptions: . Two identical buildings, each valued at $60,000 . There is a 12% chance in any year that each building is destroyed . A loss to either building is an independent event (ie. - damage to one does not cause damage to the other building) Question: What is the Standard Deviation of the Expected Loss if these two building owners agree to pool (combine) their loss exposures and each owner pays an equal share of any loss that might occur? $7, 200 $13.787 510 498 O None of these is correct QUESTION 2 Using the same assumptions from Question #1 above What is the Standard Deviation of the Expected Loss if those two building owners do NOT pool their loss exposures $7 ,200 @ $13,787 $10.408 O None of these is correct