Why is it possible for a firm to pay an actuarially fair price for insurance and still

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Why is it possible for a firm to pay an actuarially fair price for insurance and still have the insurance purchase be a positive-NPV investment?

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Fundamentals of Corporate Finance

ISBN: 978-0133400694

1st canadian edition

Authors: Jonathan Berk, Peter DeMarzo, Jarrad Harford, David A. Stangeland, Andras Marosi

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Question Posted: Mar 31, 2017 02:30 PM

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Why is it possible for a firm to pay an actuarially fair price for insurance and still

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In a perfect market without other frictions insurance companies should compete until th...View the full answer

Fundamentals of Corporate Finance

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