Assigment 6 Essay

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Assignment 6: Insurance and Consumer Protection (26.0 points) 1. Think of a real or made up but realistic example of a pure risk that you or someone you know may face, and then answer the questions below. a. Describe the specific risk. loosing a job b. What sort of negative outcomes are possible for this type of risk? you wont have any money because you wont get paid c. Would this risk be likely to create unexpected expenses? Why or why not? I don’t think so. Theres no extra bills you would have to pay. d. Describe at least one way you could protect yourself against this risk. by getting insurance 2. Think of a real or made up but realistic example of a speculative risk that you or someone you know may face, and then answer the questions below. a. Describe the specific risk. investing in something to make money b. What sort of negative outcomes are possible for this type of risk? loosing all of your money c. What sorts of positive outcomes are possible for this type of risk? you can gain money. d. Would this risk be likely to create unexpected expenses? Why or why not? no, the only thing you are putting money on is the investment. e. Describe at least one way you could protect yourself against this risk. by diversifying your investments among many different types Imagine that you are a parent with young children. You want to get life insurance to protect your children financially until they are old enough to produce their own incomes. Would term life insurance or permanent life insurance be a better choice in this situation? Why? (2-4 sentences. 1.0 points) ? Describe two types of insurance that you have or are likely to have at some point in your life. What risks are these insurance plans protecting you against? Why do you think these types of insurance are important? (4-8 sentences. 3.0 points) ? List
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