Your phone is worth 500. The risk of damaging it or losing is 10%. If damaged or lost, your phone is worth 0. There is a competitive market of insurance companies willing to insure your phone at premium a per insured sum x. Your utility function is u(w) = W0.2 a. What's the premium a? [7%] b. Suppose n=0.10. What's your optimal x*? [8%] Suppose premium was n =0.15. What's the optimal x*? [7%] d. How would the optimal x* change if your phone were worth 300 and 1 =0.15? [8%] C. Your phone is worth 500. The risk of damaging it or losing is 10%. If damaged or lost, your phone is worth 0. There is a competitive market of insurance companies willing to insure your phone at premium a per insured sum x. Your utility function is u(w) = W0.2 a. What's the premium a? [7%] b. Suppose n=0.10. What's your optimal x*? [8%] Suppose premium was n =0.15. What's the optimal x*? [7%] d. How would the optimal x* change if your phone were worth 300 and 1 =0.15? [8%] C