Suppose the Ajax Insurance Company provides insurance for skydivers whose wealth before diving is $400. An accident will leave divers with a wealth of $100. The company divides the divers into two classes, safe (probability of an accident = 0.2) and unsafe (probability of an accident = 0.5). The utility of wealth for all divers is given by the function: U(w) = w0.5 a. Given this information, the divers are risk-loving. (True / False) False b. What is the expected utility without insurance for the safe diver? | 18 c. What is the expected utility without insurance for the unsafe diver? d. If the insurer cannot distinguish between high- and low- risk divers, and there are equal numbers of each, then what would be a break-even premium (actuarially fair premium) for full insurance? $ e. What is the expected utility with this insurance policy for the safe diver? (round to 3 decimal places) f. Will low-risk divers buy this policy? (Yes/No) Yes