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How will each of the following affect the supply for insuran

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How will each of the following affect the supply for insurance?
a. a larger pool of insured persons
b. lower administration costs for insurance companies
c. higher premiums (with no change in risk experience)
d. a greater degree of risk aversion on the part of insurers

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Solution Summary

How will each of the following affect the supply for insurance?
a. a larger pool of insured persons
b. lower administration costs for insurance companies
c. higher premiums (with no change in risk experience)
d. a greater degree of risk aversion on the part of insurers

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a. a larger pool of insured persons

A larger pool of insured persons will cause the supply of insurance to increase, because the cost of the insurance decreases with a coordinating increase in demand.

b. lower administration costs for insurance companies

Lower costs for the insurance companies will cause the ...

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