Premium charged by insurers
Problem:
Question 1: Describe how the premium charged by insurers is affected by the returns available to the holders of different types of investments. Illustrate in detail clarify all workings.
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Super Clinics offers one service that has the following annual cost and volume estimates: variable cost per visit = $10, annual direct fixed costs = $50,000, allocation of overhead costs = $20,000, and expected volume = 1,000 visits.
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Describe how the premium charged by insurers is affected by the returns available to the holders of different types of investments. Illustrate in detail clarify all workings.
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