You have a fancy car video system in your car and you feel you want to insure it against theft. An insurance company offers you a $2000 1-year coverage for a premium of $245. The probability that the theft will occur is 7.5%. (Hint: This is similar to the life insurance example we did in class).

a) (5 pts) What is your expected value from this policy? (SHOW WORK. Round your answer to a whole number.)

b) (2 pts) Can the insurance company expect to make a profit from many such policies? Explain.