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Which one of the following effects occurs when two person with identical loss distribution form a risk-pool to share losses equally? a)Their individual expected loss
Which one of the following effects occurs when two person with identical loss distribution form a risk-pool to share losses equally?
a)Their individual expected loss stays the same, while the standard deviation increases
b)Their individual expected loss increases, while the standard deviation decreases
c)Their individual expected loss decreases, while the standard deviation increases
d)Their individual expected loss stays the same, while the standard deviation decreases
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