Answer
$\201
Work Step by Step
In Safe Business 2%, or 1 in 50, employees are likely to lose his or her job. To break even the insurance premium would be
$10000\div50=200$
To make a profit the charge would be \$201 per employee.
Microeconomics: Principles, Applications, and Tools (8th Edition)
by O'Sullivan, Arthur; Sheffrin, Steven; Perez, Stephen
Published by
Prentice Hall
ISBN 10:
0-13294-886-9
ISBN 13:
978-0-13294-886-9
Chapter 3 - Exchange and Markets - Exercises - 3.3 Market Failure and the Role of Government - Page 65: 3.7b
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