Types of Pecuniary Losses Assignment
Order ID 53563633773 Type Essay Writer Level Masters Style APA Sources/References 4 Perfect Number of Pages to Order 5-10 Pages
Types of Pecuniary Losses Assignment
4.1 Suppose a person is diagnosed with lung cancer. Describe four types of pecuniary losses and two types of nonpecuniary losses that are likely to arise. 4.2 The following table displays uncertainties in John’s monthly income:
State Probability (Θ) Income (Y) Utility (U) Sick 0.4 2,500 U (2,500) Healthy 0.6 4,900 U (4,900)
- What is John’s expected income (expected value of income)? b. Let John ’s utility function be U = Y0.5, where Y is John’s monthly income. Calculate John ’s expected utility of income (expected value of utility of income). c. Compare the utility of John’s expected income and the expected utility of his income. Is John risk averse or not (refer to John ’s utility function given above)?
Explain your answer by a graph, with income on the horizontal axis and utility on the vertical axis. d. Calculate the maximum amount that John is willing to pay to avoid the risk of income loss resulting from becoming sick. 4.3 Based on the same information reported in the above table, calculate the maximum amount that John is willing to pay to avoid the risk of income loss result-ing from becoming sick if the probability of becoming sick increases from 0.4 to 0.5. Is John more likely to buy health insurance than he would under conditions specified in exercise 2? Justify your answer by comparing your results for this question with what you obtained in exercise
- 4.4 Similarly, based on the same information supplied in the above table, calculate the maximum amount that John is willing to pay to avoid the risk of income loss resulting from becoming sick if the amount of income loss increases from 2,400 to 4,000, that is, John receives only 900 when sick. Is John more likely to buy health insurance than under conditions of exercise 2? Why is this so? 4.5 Assume that the individual is a risk lover. The individual can purchase a gamble with a 0.01 probability of winning $10,000. Assume the person has an annual income of $10,000.
What is the actuarial value of the gamble? Show graphically why the person would rather gamble than not, and explain your answer. 4.6 In each of the following pairs, which situation would pose a potentially larger adverse selection problem? Explain your answers. a. A policy covering accidents for all children attending summer camps or a policy covering accidents for college students traveling abroad. b. Inclusion of HIV/AIDS treatment in a standard benefit package offered to teachers or an optional rider providing HIV/AIDS coverage for an additional premium. c.
Basic medical services insurance package offered to students entering college or basic medical services package offered to professors seeking early retirement. d. Optional mental health coverage offered to employees of ABC Inc. or optional mental health coverage offered to children of ABC Inc. employees. 4.7 Considering each of the following pairs, in which of the two is purchase of health insurance more likely. Explain your answers. a. the rich versus the poor; b. hospital care versus a physician office visit; c. a probability of getting sick of 0.95 versus a 0.5 probability of getting sick; d. a tax subsidy (the premium of health insurance is not subject to any form of taxation) versus a tax credit.
QUALITY OF RESPONSE NO RESPONSE POOR / UNSATISFACTORY SATISFACTORY GOOD EXCELLENT Content (worth a maximum of 50% of the total points) Zero points: Student failed to submit the final paper. 20 points out of 50: The essay illustrates poor understanding of the relevant material by failing to address or incorrectly addressing the relevant content; failing to identify or inaccurately explaining/defining key concepts/ideas; ignoring or incorrectly explaining key points/claims and the reasoning behind them; and/or incorrectly or inappropriately using terminology; and elements of the response are lacking. 30 points out of 50: The essay illustrates a rudimentary understanding of the relevant material by mentioning but not full explaining the relevant content; identifying some of the key concepts/ideas though failing to fully or accurately explain many of them; using terminology, though sometimes inaccurately or inappropriately; and/or incorporating some key claims/points but failing to explain the reasoning behind them or doing so inaccurately. Elements of the required response may also be lacking. 40 points out of 50: The essay illustrates solid understanding of the relevant material by correctly addressing most of the relevant content; identifying and explaining most of the key concepts/ideas; using correct terminology; explaining the reasoning behind most of the key points/claims; and/or where necessary or useful, substantiating some points with accurate examples. The answer is complete. 50 points: The essay illustrates exemplary understanding of the relevant material by thoroughly and correctly addressing the relevant content; identifying and explaining all of the key concepts/ideas; using correct terminology explaining the reasoning behind key points/claims and substantiating, as necessary/useful, points with several accurate and illuminating examples. No aspects of the required answer are missing. Use of Sources (worth a maximum of 20% of the total points). Zero points: Student failed to include citations and/or references. Or the student failed to submit a final paper. 5 out 20 points: Sources are seldom cited to support statements and/or format of citations are not recognizable as APA 6th Edition format. There are major errors in the formation of the references and citations. And/or there is a major reliance on highly questionable. The Student fails to provide an adequate synthesis of research collected for the paper. 10 out 20 points: References to scholarly sources are occasionally given; many statements seem unsubstantiated. Frequent errors in APA 6th Edition format, leaving the reader confused about the source of the information. There are significant errors of the formation in the references and citations. And/or there is a significant use of highly questionable sources. 15 out 20 points: Credible Scholarly sources are used effectively support claims and are, for the most part, clear and fairly represented. APA 6th Edition is used with only a few minor errors. There are minor errors in reference and/or citations. And/or there is some use of questionable sources. 20 points: Credible scholarly sources are used to give compelling evidence to support claims and are clearly and fairly represented. APA 6th Edition format is used accurately and consistently. The student uses above the maximum required references in the development of the assignment. Grammar (worth maximum of 20% of total points) Zero points: Student failed to submit the final paper. 5 points out of 20: The paper does not communicate ideas/points clearly due to inappropriate use of terminology and vague language; thoughts and sentences are disjointed or incomprehensible; organization lacking; and/or numerous grammatical, spelling/punctuation errors 10 points out 20: The paper is often unclear and difficult to follow due to some inappropriate terminology and/or vague language; ideas may be fragmented, wandering and/or repetitive; poor organization; and/or some grammatical, spelling, punctuation errors 15 points out of 20: The paper is mostly clear as a result of appropriate use of terminology and minimal vagueness; no tangents and no repetition; fairly good organization; almost perfect grammar, spelling, punctuation, and word usage. 20 points: The paper is clear, concise, and a pleasure to read as a result of appropriate and precise use of terminology; total coherence of thoughts and presentation and logical organization; and the essay is error free. Structure of the Paper (worth 10% of total points) Zero points: Student failed to submit the final paper. 3 points out of 10: Student needs to develop better formatting skills. The paper omits significant structural elements required for and APA 6th edition paper. Formatting of the paper has major flaws. The paper does not conform to APA 6th edition requirements whatsoever. 5 points out of 10: Appearance of final paper demonstrates the student’s limited ability to format the paper. There are significant errors in formatting and/or the total omission of major components of an APA 6th edition paper. They can include the omission of the cover page, abstract, and page numbers. Additionally the page has major formatting issues with spacing or paragraph formation. Font size might not conform to size requirements. The student also significantly writes too large or too short of and paper 7 points out of 10: Research paper presents an above-average use of formatting skills. The paper has slight errors within the paper. This can include small errors or omissions with the cover page, abstract, page number, and headers. There could be also slight formatting issues with the document spacing or the font Additionally the paper might slightly exceed or undershoot the specific number of required written pages for the assignment. 10 points: Student provides a high-caliber, formatted paper. This includes an APA 6th edition cover page, abstract, page number, headers and is double spaced in 12’ Times Roman Font. Additionally, the paper conforms to the specific number of required written pages and neither goes over or under the specified length of the paper.
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